: Pearson Edexcel past-paper questions pack

Revenues, costs and profits

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 · 34 parts · mark schemes follow the questions · www.economicsaleveltutor.com · Questions and mark schemes © Pearson Edexcel

1. June 2025 · Paper 1 · Q1(a) · 4 marks · AO1=2,AO2=2

(a) Calculate the change in total supernormal profit if the restaurant changes its objective from revenue maximisation to profit maximisation. You are advised to show your working. (4)

2. June 2025 · Paper 1 · Q1(b) · 1 marks ·

(b) Refer to the previous diagram. There is a reduction in the demand for pizza. Ceteris paribus, which one of the following will happen to the restaurant’s average revenue and marginal revenue as a result of this change? (1) A Average revenue and marginal revenue both fall B Average revenue and marginal revenue stay the same C Average revenue falls and marginal revenue increases D Average revenue increases and marginal revenue falls

3. June 2025 · Paper 3 · Q1(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) Evaluate the microeconomic and macroeconomic effects of high levels of inflation. Refer to the UK or any other developed economy in your answer. (25)

4. June 2025 · Paper 3 · Q1(e) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(e) Evaluate the microeconomic and macroeconomic effects of a regional trade agreement between the UK and the EU. (25)

5. June 2024 · Paper 1 · Q6(c) · 10 marks · AO1=2,AO2=2,AO3=2,AO4=4

(c) Assess whether firms in the electronics industry benefit from economies of scale. (10)

6. June 2024 · Paper 1 · Q7 · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

7 A small hotel in Scarborough has seen its energy bills increase from £2 000 to £8 000 per month. Small businesses do not have the energy management teams of larger companies to negotiate better deals. (Source adapted from: https://www.ft.com/content/d07797e7- 2eb7-4240-b15d-692b39510def) Evaluate the microeconomic effects of rising energy bills on the hotel industry or an industry of your choice.

7. June 2024 · Paper 3 · Q2(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) Evaluate the microeconomic and macroeconomic effects of high interest rates in Ghana, or another developing country of your choice. (25)

8. June 2024 · Paper 3 · Q2(e) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(e) Evaluate the microeconomic and macroeconomic effects of Ghana joining the African Continental Free Trade Agreement (Extract F). (25)

9. June 2023 · Paper 3 · Q1(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) Discuss the likely impact of a rise in gas prices on a firm that uses a large amount of gas in its production process. Use a cost and revenue diagram to support your answer. (12)

10. June 2023 · Paper 3 · Q2(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) Discuss possible methods of price and non‑price competition that firms could use to increase the value of sales on the high street. (12)

11. June 2022 · Paper 1 · Q5(b) · 2 marks · AO1=1,AO3=1

(b) Explain one type of internal economies of scale that the newly merged car company may achieve. (2)

12. June 2022 · Paper 1 · Q6(d) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(d) Using a cost and revenue diagram, discuss the likely impact of ‘rising costs’ for coffee shops on their profitability (Extract A, line 2). (12)

13. June 2022 · Paper 3 · Q1(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) With reference to Extract C, discuss the likely effects of increasing integration within the food delivery market. (12)

14. June 2022 · Paper 3 · Q1(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) Evaluate the microeconomic and macroeconomic effects of a depreciation of the pound. Refer to restaurants or other food delivery services in your answer. (25)

15. June 2022 · Paper 3 · Q2(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) Evaluate the microeconomic and macroeconomic effects of decreasing interest rates in Kenya, or another developing country of your choice. (25)

16. November 2021 · Paper 1 · Q4(a) · 2 marks · AO2=2

(a) Calculate the total revenue from ticket sales for ‘It’s a Wonderful Life’, assuming it is shown only five times, all at full capacity. You are advised to show your working. (2)

17. November 2021 · Paper 1 · Q6(a) · 5 marks · AO1=1,AO2=2,AO3=2

(a) Explain the likely impact of diminishing marginal productivity of labour on cabin crew staffing levels. Refer to Extract A in your answer. (5)

18. November 2021 · Paper 1 · Q6(d) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(d) With reference to Extract C, discuss the proposed government subsidy to prevent Thomas Cook from reaching its shut-down point. (12)

19. November 2021 · Paper 3 · Q2(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) Discuss the likely impact of investment in new technology on the profitability of firms in Germany, as described in Extract C line 20. Use a cost and revenue diagram to support your answer. (12)

20. October 2020 · Paper 1 · Q4(a) · 2 marks · AO1=1,AO3=1

(a) Explain what happens to total cost at output levels greater than Z. (2)

21. October 2020 · Paper 1 · Q4(b) · 1 marks · AO2=1

(b) At output levels greater than Z, which one of the following correctly identifies what will happen to the cost? (1) Average fixed cost Average variable cost Marginal cost A Falls Falls Rises B Falls Rises Rises C Rises Rises Falls D Rises Rises Rises

22. October 2020 · Paper 1 · Q4(c) · 2 marks · AO2=2

(c) For a luxury doughnut producer the average selling price is £2. The average variable cost is 40% of the selling price and its fixed cost per day is £300. Calculate total costs per day assuming it produces 400 doughnuts per day. (2)

23. October 2020 · Paper 3 · Q1(d) · 25 marks · AO1=4,AO2=4,AO3=8,AO4=9

(d) Evaluate the likely microeconomic and macroeconomic effects of a rise in interest rates in Turkey. (25)

24. October 2020 · Paper 3 · Q2(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) Discuss factors that are causing many high street retailers in the UK to close some branches or shut down completely. Use a cost and revenue diagram to support your answer. (12)

25. June 2019 · Paper 1 · Q4(b) · 4 marks · AO1=2,AO2=2

Following the demerger, GoCompare announced in 2017 a profit of £17.5 million, up 21.5% on 2016. Total revenue in 2017 was £75.8 million, up 4.1% on 2016. (Source: adapted from https://www.insuranceage.co.uk/insurer/3107496/ profits-up-at-go-compare) (b) Calculate, using the information provided, the total costs of GoCompare in 2016. (4)

26. June 2019 · Paper 1 · Q6(d) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(d) Discuss one likely reason for the rise in BT’s profit (Figure 2, Extracts B and C). Use a cost and revenue diagram to support your answer. (12)

27. June 2018 · Paper 1 · Q3(a) · 2 marks · AO2=2

(a) Assume the selling fee is 1.3%. Calculate the payment received by an estate agent on a property sold for £489 000. You are advised to show your working. (2)

28. June 2018 · Paper 1 · Q4(a) · 4 marks · AO1=2,AO2=2

(a) Calculate the change in total supernormal profit if Emily changes her objective from profit maximisation to revenue maximisation. You are advised to show your working. (4)

29. June 2018 · Paper 3 · Q2(b) · 8 marks · AO1=2,AO2=2,AO3=2,AO4=2

(b) Examine the likely effects on the profitability of Indonesian rice farmers of the government’s increased investment in dams (Extract E, lines 43-48). Use a cost and revenue diagram to support your answer. (8)

30. June 2017 · Paper 1 · Q4(a) · 4 marks · AO1=2,AO2=2

(a) Draw a cost and revenue diagram to show the likely impact of a reduction in sales of construction equipment on JCB’s profits. (4)

31. June 2017 · Paper 1 · Q5(a) · 1 marks ·

(a) Which one of the following is a fixed cost to Starbucks? (1) A Coffee B Milk C Packaging D Rent

32. June 2017 · Paper 1 · Q5(b) · 2 marks · AO1=1,AO3=1

(b) Explain the difference between fixed costs and variable costs. (2)

33. June 2017 · Paper 1 · Q5(c) · 2 marks · AO2=2

(c) With reference to Figure 1, calculate the profit (in pence) for a cappuccino drink. You are advised to show your working. (2)

34. June 2017 · Paper 3 · Q2(c) · 12 marks · AO1=2,AO2=2,AO3=4,AO4=4

(c) Discuss the likely impact of the National Living Wage on the profitability of firms. Use a cost and revenue diagram in your answer. (12)

Mark schemes

1. June 2025 · Paper 1 · Q1(a)

2. June 2025 · Paper 1 · Q1(b)

3. June 2025 · Paper 3 · Q1(d)

4. June 2025 · Paper 3 · Q1(e)

5. June 2024 · Paper 1 · Q6(c)

6. June 2024 · Paper 1 · Q7

7. June 2024 · Paper 3 · Q2(d)

8. June 2024 · Paper 3 · Q2(e)

9. June 2023 · Paper 3 · Q1(c)

10. June 2023 · Paper 3 · Q2(c)

11. June 2022 · Paper 1 · Q5(b)

12. June 2022 · Paper 1 · Q6(d)

13. June 2022 · Paper 3 · Q1(c)

14. June 2022 · Paper 3 · Q1(d)

15. June 2022 · Paper 3 · Q2(d)

16. November 2021 · Paper 1 · Q4(a)

17. November 2021 · Paper 1 · Q6(a)

18. November 2021 · Paper 1 · Q6(d)

19. November 2021 · Paper 3 · Q2(c)

20. October 2020 · Paper 1 · Q4(a)

21. October 2020 · Paper 1 · Q4(b)

22. October 2020 · Paper 1 · Q4(c)

23. October 2020 · Paper 3 · Q1(d)

24. October 2020 · Paper 3 · Q2(c)

25. June 2019 · Paper 1 · Q4(b)

26. June 2019 · Paper 1 · Q6(d)

27. June 2018 · Paper 1 · Q3(a)

28. June 2018 · Paper 1 · Q4(a)

29. June 2018 · Paper 3 · Q2(b)

30. June 2017 · Paper 1 · Q4(a)

31. June 2017 · Paper 1 · Q5(a)

32. June 2017 · Paper 1 · Q5(b)

33. June 2017 · Paper 1 · Q5(c)

34. June 2017 · Paper 3 · Q2(c)