: Pearson Edexcel past-paper questions pack

Price, income and cross elasticities of demand

Past-paper questions pack

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Questions are numbered; the mark schemes (the answer key) follow on separate pages so the question pages can be handed out alone. www.economicsaleveltutor.com

Pearson Edexcel AS and A-level Economics past-paper questions since 2016 · 50 parts · mark schemes follow the questions · www.economicsaleveltutor.com · Questions and mark schemes © Pearson Edexcel

1. June 2025 · AS Paper 1 · Q2(a) · 3 marks · AO1=1,AO2=2

(a) In 2021, a bakery sold 2.5 million sausage rolls per week at the price of £1.00 each. In 2022 the price increased to £1.20. The price elasticity of demand was estimated to be -0.2. Calculate the new quantity of sausage rolls sold per week in 2022 after the price increased, ceteris paribus. (3)

2. June 2025 · AS Paper 1 · Q2(b) · 1 marks ·

(b) Which one of the following is the most appropriate description of the price elasticity of demand of -0.2? (1) A Perfectly inelastic B Relatively elastic C Relatively inelastic D Unitary elastic

3. June 2025 · Paper 1 · Q2(b) · 1 marks ·

(b) The cross elasticity of demand for petrol cars with respect to the price of diesel cars is estimated to be +0.64. Which one of the following is the most likely impact if the price of diesel cars falls by 10%? (1) A The price of petrol cars falls by 6.4% B The price of petrol cars rises by 64% C The quantity demanded of petrol cars falls by 6.4% D The quantity demanded of petrol cars rises by 64%

4. June 2025 · AS Paper 1 · Q6(a) · 5 marks · AO1=1,AO2=2,AO3=2

(a) With reference to Extract B, explain why the change to meat-substitute products may result in an increase in the revenue of food companies. Refer to the concept of price elasticity of demand in your answer. (5)

5. June 2025 · Paper 1 · Q6(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) With reference to the information provided, discuss whether the price elasticity of demand for video games is elastic or inelastic. (12)

6. June 2024 · Paper 1 · Q1(a) · 4 marks · AO1=2,AO2=1,AO3=1

(a) Explain one likely reason for the difference in the price elasticity of demand for the 18+ student bus ticket and the adult bus ticket. (4)

7. June 2024 · Paper 1 · Q1(b) · 1 marks ·

(b) In 2021, the adult 7-day bus ticket was £21.90. Bus ticket prices in London in 2022 increased by 4.8%. Ceteris paribus, which one of the following is the percentage decrease in the 7-day bus ticket demand by adults? (1) A 0.08 B 1.92 C 3.36 D 12.00

8. June 2024 · AS Paper 1 · Q5(a) · 2 marks · AO1=1,AO2=1

(a) In June 2023, Tesla further reduced the price of its Model 3 vehicle by £4 200 from £42 990. It has been forecast that the price cut will lead to a 15% increase in demand. Ceteris paribus, calculate the price elasticity of demand for the Model 3. You are advised to show your working. (2)

9. June 2024 · AS Paper 1 · Q5(c) · 1 marks · AO1=1

(c) Which one of the following is most likely to be a determinant of price elasticity of demand for the Model 3 electric vehicle? (1) A Availability of substitute electric vehicles B Change in population size C Increase in the cost of steel D Number of unsold Model 3 electric vehicles

10. June 2024 · AS Paper 1 · Q6(c) · 4 marks · AO1=2,AO2=2

(c) With reference to Extract A, explain the likely numerical value for the income elasticity of demand for reusable cleaning products. (4)

11. June 2024 · AS Paper 1 · Q6(d) · 6 marks · AO1=2,AO2=2,AO3=2

(d) With reference to Extract C, explain how incentives to use reusable coffee cups may lead to a fall in demand for single‑use cups. (6)

12. June 2024 · Paper 3 · Q1(a) · 5 marks · AO1=2,AO2=2,AO3=1

(a) With reference to Figure 1 and Extract A, explain what is meant by ‘price inelastic demand’ (line 8). (5)

13. June 2023 · AS Paper 1 · Q2(b) · 1 marks ·

(b) The table below shows estimates of the price elasticity of supply and price elasticity of demand for gas. Natural Gas Price elasticity of supply + 0.14 Price elasticity of demand - 0.10 (Source: adapted from http://www.usaee.org/usaee2013/submissions/Abs/Ponce_ Neumann_Elasticities_gas_supply.pdf, http://www.mackinac.org/1247) Which one of the following can be inferred from the table? (1) A A 10% increase in the price of gas would cause a more than 10% increase in the supply B Gas is a normal good with income inelastic demand C The demand and supply of gas are both price inelastic D The demand for gas is more responsive to changes in price than supply

14. June 2023 · Paper 1 · Q3(a) · 1 marks · AO2=1

(a) The likely income elasticity of demand for a luxury good is: (1) A –3.40 B –0.74 C +0.74 D +3.40

15. June 2023 · AS Paper 1 · Q4(b) · 1 marks ·

Esso, Tesco and Sainsbury’s all charge £ 1.48 for a litre of petrol. (b) Which one of the following is the most likely cross price elasticity of demand for close substitutes? (1) A - 2.1 B - 0.1 C + 0.1 D + 2.1

16. June 2023 · AS Paper 1 · Q6(a) · 5 marks · AO1=1,AO2=2,AO3=2

(a) With reference to Figure 1 and Extract A, explain the relationship between price elasticity of demand and total revenue. (5)

17. June 2023 · Paper 1 · Q6(c) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

(c) With reference to the information provided, examine the likely numerical value of the cross elasticity of demand between UK online streaming services. (8)

18. June 2023 · AS Paper 1 · Q6(d) · 4 marks · AO1=2,AO2=2

(d) Using examples from the information provided, explain what is meant by both ‘substitutes’ and ‘complementary goods’. (4)

19. June 2022 · Paper 1 · Q2(a) · 2 marks · AO2=2

(a) The price of sweetened drinks increases by 5%. Ceteris paribus, calculate the percentage change in the quantity demanded for sweetened drinks. You are advised to show your working. (2)

20. June 2022 · Paper 1 · Q2(b) · 2 marks · AO2=2

(b) The price of sweetened drinks increases by 5%. Ceteris paribus, calculate the percentage change in the quantity demanded for bottled water. You are advised to show your working. (2)

21. June 2022 · Paper 1 · Q2(c) · 1 marks · AO1=1

(c) Using the data on page 4, which one of the following is most likely? (1) A decrease in the price of Sweetened drinks and sweetened drinks will have the bottled water are: following effect on revenue: A Decrease Complements B Decrease Substitutes C Increase Complements D Increase Substitutes

22. June 2022 · Paper 1 · Q6(b) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

(b) With reference to Figure 2 and your understanding of price elasticity, examine two factors that may cause significant changes in the international price of coffee beans. (8)

23. June 2022 · AS Paper 1 · Q6(d) · 4 marks · AO1=2,AO2=2

Fish and chips are complementary goods with an estimated cross elasticity of demand of –8. Currently 950 000 bags of chips are sold in UK fish and chip shops each day. (d) With reference to the information provided, calculate the new quantity demanded of bags of chips from fish and chip shops, following a 2% increase in the price of fish. You are advised to show your working. (4)

24. June 2022 · Paper 3 · Q1(b) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

(b) With reference to Extract B, examine whether the demand for delivered food is price inelastic and income elastic. (8)

25. November 2021 · Paper 3 · Q1(b) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

(b) Examine two reasons why the demand for HCWs increases during a period when consumer ‘incomes fail to keep up with inflation’ (Extract A line 8). (8)

26. October 2020 · AS Paper 1 · Q2(a) · 1 marks ·

(a) The income elasticity of demand for bus travel is estimated to be –1.5. This implies that: (1) A a 10% increase in fares will lead to a 15% decrease in passengers B as unemployment falls, more people will use buses C bus travel has a negative cross elasticity of demand compared to rail travel D bus travel is an inferior good

27. October 2020 · AS Paper 1 · Q2(b) · 3 marks · AO1=1,AO2=1,AO3=1

(b) Explain why a firm might try to reduce the price elasticity of demand for its products. (3)

28. October 2020 · AS Paper 1 · Q6(a) · 5 marks · AO1=1,AO2=2,AO3=2

(a) Explain why ‘the price elasticity of demand for higher education is about –0.5’ may be of relevance to English universities. Refer to Extract A in your answer. (5)

29. October 2020 · Paper 1 · Q7 · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

7 The International Energy Agency has predicted that oil use by cars will peak in 2025 because of the increasing number of drivers switching to electric vehicles. (Source adapted from: https://www.thetimes.co.uk) Evaluate the likely microeconomic consequences of consumers shifting from vehicles powered by fuel obtained from oil to electric‑powered vehicles.

30. June 2019 · AS Paper 1 · Q3(a) · 1 marks · AO2=1

(a) The most likely cross price elasticity of demand for close substitutes is: (1) A – 2.1 B – 0.1 C + 0.1 D + 2.1

31. June 2019 · AS Paper 1 · Q3(b) · 3 marks · AO1=1,AO2=2

In 2016 the average cinema ticket price in the UK was £7.41, and there were 19.1 million tickets sales. The price elasticity of demand was estimated to be –0.5. (b) Calculate the new total revenue if prices were raised by 3% in 2017 to £7.63, if everything else remained unchanged. You are advised to show your working. (3)

32. June 2019 · AS Paper 1 · Q5(a) · 1 marks · AO2=1

(a) Calculate the percentage change in quantity demanded for Freddos between 2015 and 2017, ceteris paribus: (1) A –0.8% B –2% C –2.5% D –25%

33. June 2019 · AS Paper 1 · Q5(b) · 3 marks · AO1=1,AO2=1,AO3=1

(b) Explain one reason why the income elasticity of demand is significant to the producer of Freddos. (3)

34. June 2018 · AS Paper 1 · Q2(a) · 2 marks · AO2=2

(a) Ceteris paribus, calculate the price elasticity of demand for the Daily Mail newspaper over this period. You are advised to show your working. (2)

35. June 2018 · AS Paper 1 · Q2(b) · 1 marks ·

(b) Which one of the following is most likely to be a determinant of price elasticity of demand for the Daily Mail newspaper? (1) A Availability of rival newspapers B Change in population size C Decrease in the cost of producing the Daily Mail newspaper D Expected rise in the price of the Daily Mail newspaper

36. June 2018 · Paper 1 · Q2(b) · 2 marks · AO1=1,AO3=1

Research conducted for HMRC estimated the cross elasticity of demand for using gaming machines to be 1.28 in response to changes in the price of national lottery tickets. (Source: https://www.gov.uk/government/uploads/system/uploads/ attachment_data/file/322845/report313.pdf) In October 2013 Camelot increased the price of a national lottery ticket from £1 to £2. (b) Explain the likely impact of the price increase of national lottery tickets on the demand for using gaming machines. (2)

37. June 2018 · AS Paper 1 · Q4(a) · 1 marks ·

(a) Which one of the following is the most accurate explanation of the term ‘median household income’? (1) A The difference between the highest level of household income and the lowest level of household income B The middle household income after placing all household incomes in numerical order C The most frequently occurring level of household income D Total household income divided by the number of households

38. June 2018 · AS Paper 1 · Q4(b) · 3 marks · AO1=1,AO2=1,AO3=1

(b) Using the data provided, explain whether bus travel is a normal good or an inferior good. (3)

39. June 2018 · Paper 1 · Q6(d) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

The price elasticity of demand for electricity in the UK is estimated to be –0.35 in the short run and –0.85 in the long run. (d) With reference to Extract A and your own knowledge, examine two possible reasons for the change in price elasticity of demand for electricity over time. (8)

40. June 2018 · Paper 3 · Q2(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) With reference to the information provided and your own knowledge, evaluate the microeconomic and macroeconomic effects on Indonesia of the volatility of prices of commodities such as coal. (25)

41. June 2017 · Paper 1 · Q1(b) · 1 marks ·

(b) Research conducted in New Zealand in 2014 estimated the cross elasticity of demand for e-cigarettes to be 0.16 in response to changes in the price of tobacco. This implies that a 5% increase in the price of tobacco will cause the percentage change in demand for e-cigarettes to be: (1) A -31.25 B -0.16 C 0.8 D 31.25

42. June 2017 · Paper 1 · Q2(a) · 2 marks · AO2=2

(a) Assume that the change in the quantity of tea purchased was only caused by the change in the price of tea. Calculate the price elasticity of demand for tea in response to the rise in its price. You are advised to show your working. (2)

43. June 2017 · Paper 1 · Q2(b) · 2 marks · AO1=1,AO3=1

(b) Calculate the change in total sales revenue for UK tea retailers between 2010 and 2015. You are advised to show your working. (2)

44. June 2017 · Paper 1 · Q2(c) · 1 marks ·

(c) Estimates for the demand for black tea in the UK suggest that it is an inferior good. This implies it has a negative: (1) A cross elasticity of demand B income elasticity of demand C price elasticity of demand D price elasticity of supply

45. June 2017 · AS Paper 1 · Q6(c) · 6 marks · AO1=2,AO2=2,AO3=2

Tobacco cigarettes and e-cigarettes are considered to be substitutes. (c) Explain how changes in the price of tobacco cigarettes may affect the demand for e-cigarettes over time. (6)

46. June 2017 · AS Paper 1 · Q6(d) · 4 marks · AO1=2,AO2=2

(d) With reference to Extract A, lines 11–13, calculate the price elasticity of demand for tobacco cigarettes in high-income countries and in low-middle-income countries. You are advised to show your working. (4)

47. June 2017 · AS Paper 1 · Q6(e) · 15 marks · AO1=3,AO2=3,AO3=3,AO4=6

(e) With reference to Figure 1, assess the likely reasons for the difference in price elasticity of demand for tobacco cigarettes and e-cigarettes. (15)

48. June 2016 · AS Paper 1 · Q5(a) · 1 marks ·

(a) What is the expected percentage change in the quantity of petrol demanded if the price elasticity of demand is –0.2? (1) A –0.4% B +0.4% C –4% D +4%

49. June 2016 · AS Paper 1 · Q5(b) · 3 marks · AO1=1,AO2=2

(b) The price elasticity of demand for petrol is –0.2. Explain the change to the total revenue of petrol stations as a result of cutting their prices. (3)

50. June 2016 · AS Paper 1 · Q6(b) · 10 marks · AO1=2,AO2=2,AO3=2,AO4=4

(b) With reference to Extract A, assess the likely impact of the Help to Buy scheme on the market for rented properties in the UK. (10)

Mark schemes

1. June 2025 · AS Paper 1 · Q2(a)

2. June 2025 · AS Paper 1 · Q2(b)

3. June 2025 · Paper 1 · Q2(b)

4. June 2025 · AS Paper 1 · Q6(a)

5. June 2025 · Paper 1 · Q6(c)

6. June 2024 · Paper 1 · Q1(a)

7. June 2024 · Paper 1 · Q1(b)

8. June 2024 · AS Paper 1 · Q5(a)

9. June 2024 · AS Paper 1 · Q5(c)

10. June 2024 · AS Paper 1 · Q6(c)

11. June 2024 · AS Paper 1 · Q6(d)

12. June 2024 · Paper 3 · Q1(a)

13. June 2023 · AS Paper 1 · Q2(b)

14. June 2023 · Paper 1 · Q3(a)

15. June 2023 · AS Paper 1 · Q4(b)

16. June 2023 · AS Paper 1 · Q6(a)

17. June 2023 · Paper 1 · Q6(c)

18. June 2023 · AS Paper 1 · Q6(d)

19. June 2022 · Paper 1 · Q2(a)

20. June 2022 · Paper 1 · Q2(b)

21. June 2022 · Paper 1 · Q2(c)

22. June 2022 · Paper 1 · Q6(b)

23. June 2022 · AS Paper 1 · Q6(d)

24. June 2022 · Paper 3 · Q1(b)

25. November 2021 · Paper 3 · Q1(b)

26. October 2020 · AS Paper 1 · Q2(a)

27. October 2020 · AS Paper 1 · Q2(b)

28. October 2020 · AS Paper 1 · Q6(a)

29. October 2020 · Paper 1 · Q7

30. June 2019 · AS Paper 1 · Q3(a)

31. June 2019 · AS Paper 1 · Q3(b)

32. June 2019 · AS Paper 1 · Q5(a)

33. June 2019 · AS Paper 1 · Q5(b)

34. June 2018 · AS Paper 1 · Q2(a)

35. June 2018 · AS Paper 1 · Q2(b)

36. June 2018 · Paper 1 · Q2(b)

37. June 2018 · AS Paper 1 · Q4(a)

38. June 2018 · AS Paper 1 · Q4(b)

39. June 2018 · Paper 1 · Q6(d)

40. June 2018 · Paper 3 · Q2(d)

41. June 2017 · Paper 1 · Q1(b)

42. June 2017 · Paper 1 · Q2(a)

43. June 2017 · Paper 1 · Q2(b)

44. June 2017 · Paper 1 · Q2(c)

45. June 2017 · AS Paper 1 · Q6(c)

46. June 2017 · AS Paper 1 · Q6(d)

47. June 2017 · AS Paper 1 · Q6(e)

48. June 2016 · AS Paper 1 · Q5(a)

49. June 2016 · AS Paper 1 · Q5(b)

50. June 2016 · AS Paper 1 · Q6(b)