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1.3 Market Failure
Question Paper
Course Edexcel A Level Economics A
Section 1. Introduction to Markets & Market Failure
Topic 1.3 Market Failure
Difficulty Medium
Time allowed: 90
Score: /74
Percentage: /100
Page 1 of 9
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, Head to savemyexams.co.uk for more awesome resources
Question 1a
The external benefits of higher education include increased tax revenue, faster economic growth, greater innovation and
labour market flexibility.
(Source adapted from: https://www.timeshighereducation.com/news/higher-education-its-good-for-you-and-society/2008681.article#survey-answer)
(a)
Draw an externalities diagram to show the likely impact of the consumption of higher education.
[4 marks]
Question 1b
(b)
On average, in the UK, a working-age graduate earns approximately £10 000 more per year than a non-graduate.
(Source adapted from: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/701720/GLMS_2017.pdf)
This suggests a university degree provides a substantial ________________.
A. external benefit
B. external cost
C. private benefit
D. social cost
Page 2 of 9
© 2015-2023 Save My Exams, Ltd. · Revision Notes, Topic Questions, Past Papers
1.3 Market Failure
Question Paper
Course Edexcel A Level Economics A
Section 1. Introduction to Markets & Market Failure
Topic 1.3 Market Failure
Difficulty Medium
Time allowed: 90
Score: /74
Percentage: /100
Page 1 of 9
© 2015-2023 Save My Exams, Ltd. · Revision Notes, Topic Questions, Past Papers
, Head to savemyexams.co.uk for more awesome resources
Question 1a
The external benefits of higher education include increased tax revenue, faster economic growth, greater innovation and
labour market flexibility.
(Source adapted from: https://www.timeshighereducation.com/news/higher-education-its-good-for-you-and-society/2008681.article#survey-answer)
(a)
Draw an externalities diagram to show the likely impact of the consumption of higher education.
[4 marks]
Question 1b
(b)
On average, in the UK, a working-age graduate earns approximately £10 000 more per year than a non-graduate.
(Source adapted from: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/701720/GLMS_2017.pdf)
This suggests a university degree provides a substantial ________________.
A. external benefit
B. external cost
C. private benefit
D. social cost
Page 2 of 9
© 2015-2023 Save My Exams, Ltd. · Revision Notes, Topic Questions, Past Papers
