AQA ECONOMICS - PAPER 2 - THE
GLOBAL ECONOMY EXAM QUESTIONS
WITH VERIFIED ANSWERS. A+ GRADE
2025/2026.
What are the main characteristics of globalisation? - ANS Free movement of capital and
labour across International boundaries, free trade between countries and the availability of
technology and intellectual capital to be used on an international scale
In the last 50 years, why has the scale and pace of globalisation increased? - ANS Trade
liberalisation - removal of tariffs etc. may negotiate these with WTO.
WTO raised standards on global products - to increase consumer confidence in imported goods
Reduction in cost and time needed - for transportation of goods. Cheaper to import and export.
E.g. could be due to larger cargo ships
Improvements in communication - e.g. internet makes trade easier and cheaper
MNC's wishing to increase profits - might built a factory in and LEDC for cheap labour. Increase
in FDI from MNC's
Firms expanding overseas - wish to exploit economies of scale
More MNC's with influence - more international trade and investment as influence grows
Governments wanting benefits of International trade - e.g. govt might want to provide
incentives for foreign firms to invest in their country
The opening of markets to trade and investment - e.g. after collapse of USSR economy opens up
and globalisation increases through more trade
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
, Growth in international trading blocs
Increased investment by sovereign states - Norway invests some oil revenues in foreign
companies
International specialisation - best at making in one country encouraging international trade
What are some cultural and political factors involved in globalisation? - ANS International
bodies e.g. UN lead to more joint decision between countries and firms - cultural globalisation
e.g. McDonalds
International trade becoming a greater proportion of all trade and de-industrialisation of
MEDC's for industrialisation of LEDC's are both characteristics
What are the reasons for big firms setting up companies in emerging countries? - ANS Cheap
labour and same technology and skills needed to produce products
Which factors attract MNC's to invest in a country? - ANS Cheap raw material and labour,
good transport links, access to different markets and pro-foreign investment governments
What are some things globalisation and trade encourage? - ANS specialisation in economies
to create comparative advantage in that country (more efficient than another country at
making a certain product), trade makes bigger markets so economies of scale are more present
and World GDP has risen as a result of globalisation
What are some drawbacks of globalisation? - ANS Some prices rise as world incomes rise so
there is sometimes excess demand, Specialisation can lead to overreliance on markets - e.g.
Venezuela over-reliance on oil revenue (not a specialised markets but the reliance is there :D)
and individuals firms could be outcompeted by foreign firms
What are some positives and negatives of MNC's? - ANS Positives
- FDI by these firms creates jobs and therefore wreath and skilled workers. MNC's also buy local
goods and services.
- MNC's can benefit for Economies of Scale (EOS)
- Some believe these firms increase living standards
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
GLOBAL ECONOMY EXAM QUESTIONS
WITH VERIFIED ANSWERS. A+ GRADE
2025/2026.
What are the main characteristics of globalisation? - ANS Free movement of capital and
labour across International boundaries, free trade between countries and the availability of
technology and intellectual capital to be used on an international scale
In the last 50 years, why has the scale and pace of globalisation increased? - ANS Trade
liberalisation - removal of tariffs etc. may negotiate these with WTO.
WTO raised standards on global products - to increase consumer confidence in imported goods
Reduction in cost and time needed - for transportation of goods. Cheaper to import and export.
E.g. could be due to larger cargo ships
Improvements in communication - e.g. internet makes trade easier and cheaper
MNC's wishing to increase profits - might built a factory in and LEDC for cheap labour. Increase
in FDI from MNC's
Firms expanding overseas - wish to exploit economies of scale
More MNC's with influence - more international trade and investment as influence grows
Governments wanting benefits of International trade - e.g. govt might want to provide
incentives for foreign firms to invest in their country
The opening of markets to trade and investment - e.g. after collapse of USSR economy opens up
and globalisation increases through more trade
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
, Growth in international trading blocs
Increased investment by sovereign states - Norway invests some oil revenues in foreign
companies
International specialisation - best at making in one country encouraging international trade
What are some cultural and political factors involved in globalisation? - ANS International
bodies e.g. UN lead to more joint decision between countries and firms - cultural globalisation
e.g. McDonalds
International trade becoming a greater proportion of all trade and de-industrialisation of
MEDC's for industrialisation of LEDC's are both characteristics
What are the reasons for big firms setting up companies in emerging countries? - ANS Cheap
labour and same technology and skills needed to produce products
Which factors attract MNC's to invest in a country? - ANS Cheap raw material and labour,
good transport links, access to different markets and pro-foreign investment governments
What are some things globalisation and trade encourage? - ANS specialisation in economies
to create comparative advantage in that country (more efficient than another country at
making a certain product), trade makes bigger markets so economies of scale are more present
and World GDP has risen as a result of globalisation
What are some drawbacks of globalisation? - ANS Some prices rise as world incomes rise so
there is sometimes excess demand, Specialisation can lead to overreliance on markets - e.g.
Venezuela over-reliance on oil revenue (not a specialised markets but the reliance is there :D)
and individuals firms could be outcompeted by foreign firms
What are some positives and negatives of MNC's? - ANS Positives
- FDI by these firms creates jobs and therefore wreath and skilled workers. MNC's also buy local
goods and services.
- MNC's can benefit for Economies of Scale (EOS)
- Some believe these firms increase living standards
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED
