AQA ECONOMICS ADVANCED LEVEL
PAPER FIRST ASSESSMENT 2026 EXTENSIVE
ACTUAL QUESTIONS AND THOROUGHLY
DEFINED VERIFIED SOLUTIONS GRADED
A+
⩥ Profit Satisficing. Answer: Making just enough profit to satisfy the
demands of business owners
⩥ Shareholders. Answer: The owners of a company
⩥ Stakeholders. Answer: Any individual or group who hold a vested
interest in the activities of a business.
⩥ Growth Objective. Answer: Aims to increase the product's market
share.
⩥ Perfectly Competitive Market. Answer: A market that meets the
conditions of (1) many buyers and sellers, (2) all firms selling identical
products, and (3) no barriers to new firms entering the market.
⩥ Monopoly. Answer: A market in which there are many buyers but only
one seller.
,⩥ Monopolistic Competition. Answer: A market structure in which
barriers to entry are low and many firms compete by selling similar, but
not identical, products. It is characterised as having a downwards
sloping demand curve.
⩥ Pure Monopoly. Answer: the only supplier of a unique product with
no close substitutes
⩥ Monopoly Power. Answer: In the UK a firm is said to have monopoly
power if it has more than 25% of the market share. For example, Tesco
at 30% market share or Google 90% of search engine traffic. They seek
to profit maximise and produce where MR=MC.
⩥ Natural Monopoly. Answer: A monopoly that arises because a single
firm can supply a good or service to an entire market at a smaller cost
than could two or more firms e.g. water suppliers
⩥ Oligopoly. Answer: A market structure in which a few large firms
dominate a market
⩥ Nth Firm Concentration Ratio. Answer: How much market share is
held by the top N firms in the market.
⩥ Characteristics of a Monopoly. Answer: -A single producer
, -No close substitutes
-Barriers to entry
-Price setting powers
⩥ Misallocation of Resources. Answer: Occurs when a good or service
is not consumed by the person who values it the most, and typically
results when a price ceiling creates an artificial shortage in the market.
⩥ Competitive Market. Answer: A market in which there are many
buyers and many sellers so that each has a negligible impact on the
market price
⩥ Invention. Answer: A new product, system, or process that has never
existed before, created by study and experimentation.
⩥ Innovation. Answer: Innovation is about putting a new idea or
approach into action. Innovation is commonly described as 'the
commercially successful exploitation of ideas'.
⩥ Public Goods. Answer: Goods that are neither excludable nor
rivalrous in consumption
⩥ Private Goods. Answer: goods that are both excludable and rivalrous
in consumption
PAPER FIRST ASSESSMENT 2026 EXTENSIVE
ACTUAL QUESTIONS AND THOROUGHLY
DEFINED VERIFIED SOLUTIONS GRADED
A+
⩥ Profit Satisficing. Answer: Making just enough profit to satisfy the
demands of business owners
⩥ Shareholders. Answer: The owners of a company
⩥ Stakeholders. Answer: Any individual or group who hold a vested
interest in the activities of a business.
⩥ Growth Objective. Answer: Aims to increase the product's market
share.
⩥ Perfectly Competitive Market. Answer: A market that meets the
conditions of (1) many buyers and sellers, (2) all firms selling identical
products, and (3) no barriers to new firms entering the market.
⩥ Monopoly. Answer: A market in which there are many buyers but only
one seller.
,⩥ Monopolistic Competition. Answer: A market structure in which
barriers to entry are low and many firms compete by selling similar, but
not identical, products. It is characterised as having a downwards
sloping demand curve.
⩥ Pure Monopoly. Answer: the only supplier of a unique product with
no close substitutes
⩥ Monopoly Power. Answer: In the UK a firm is said to have monopoly
power if it has more than 25% of the market share. For example, Tesco
at 30% market share or Google 90% of search engine traffic. They seek
to profit maximise and produce where MR=MC.
⩥ Natural Monopoly. Answer: A monopoly that arises because a single
firm can supply a good or service to an entire market at a smaller cost
than could two or more firms e.g. water suppliers
⩥ Oligopoly. Answer: A market structure in which a few large firms
dominate a market
⩥ Nth Firm Concentration Ratio. Answer: How much market share is
held by the top N firms in the market.
⩥ Characteristics of a Monopoly. Answer: -A single producer
, -No close substitutes
-Barriers to entry
-Price setting powers
⩥ Misallocation of Resources. Answer: Occurs when a good or service
is not consumed by the person who values it the most, and typically
results when a price ceiling creates an artificial shortage in the market.
⩥ Competitive Market. Answer: A market in which there are many
buyers and many sellers so that each has a negligible impact on the
market price
⩥ Invention. Answer: A new product, system, or process that has never
existed before, created by study and experimentation.
⩥ Innovation. Answer: Innovation is about putting a new idea or
approach into action. Innovation is commonly described as 'the
commercially successful exploitation of ideas'.
⩥ Public Goods. Answer: Goods that are neither excludable nor
rivalrous in consumption
⩥ Private Goods. Answer: goods that are both excludable and rivalrous
in consumption
