9ec0 03 Pef 20220818

Examiners’ Report
June 2022
GCE Economics A 9EC0 03
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June 2022
Publications Code 9EC0_03_2206_ER
All the material in this publication is copyright
© Pearson Education Ltd 2022
GCE Economics A 9EC0 03 2

Introduction
The paper was seen to be highly accessible, and the context of the questions was fully in line
with the Advanced Information, and most questions were answered with cogent economics
and integrated diagrams. The data was readily usable, and the best answers made use of it in
every question, as indeed is expected on data response papers. The lack of time to digest the
data was an issue for many students and there were many essays that were written entirely
out of context.
The area causing the most problems for students was 2c, given that the concept of absolute
advantage was not generally used or applied. Most diagrams were AD/AS rather than the
expected absolute advantage tables or PPFs, and the mark scheme was broadened to ensure
that the majority of candidates could access marks despite the seemingly challenging
question.
There was a tendency for candidates to write far too much for the 5 – and 8-mark questions,
running out of time at the end. Candidates should be reminded that full marks can be
earned in a fraction of the space available on the exam paper itself, and there is an especially
large amount of space given when diagrams or calculations are required, to allow for
crossings out.
The main problem seen by examiners was the lack of exam practice, exam skills and general
inability to work through unseen data and relate this to the models and theories that had
been taught or self-taught.
3 GCE Economics A 9EC0 03

Question 1 (a)
This was an accessible question which produced good answers, and the mean score was well
above average for a 5-mark question across the Papers and the exam series as a whole.
Many candidates benefited by including an externality diagram, although not asked for.
There were a significant number of candidates who suggested a negative externality in
consumption and supported this with an accurate diagram (even though this is not required
by the Pearson Edexcel specification) for example in the consumption of HFSS foods without
'getting up from their sofa'. This was not essential to achieve full marks and should not be
encouraged because it tends to cause confusion and incorrect analysis when diagrams not
required are forced into an answer. It was much more effective to draw a negative
externalities in production diagram, and then consider the effects on third parties of food
delivery using fossil fuels.
Generic references to 'harms the environment' did not score highly. Candidates needed to
explain the impact on the third party. Note that 2 marks are available for application and
referring to the information provided. Some candidates failed to use the information
provided which restricted the available marks. Candidates should be encouraged to be
explicit in their conclusions namely that in the presence of negative externalities the free
market will over provide.
This answer does not refer to a third party, and refers to workers, which are not external to
the transaction.

There is use of data so there is 2/2 for application. The knowledge of
the meaning of the term 'externality' is identified in line 8 but the
impact on the third party is too vague – the 'environment'. A specific
impact, e.g. days at work lost from asthma sufferers, is more clear as
to who the third party is.
3/5 total

Identify a third party.
There are 2 marks for application.
Use a diagram if you can.

This was a very clear 5/5.
The diagram is correct and the one that the specification expects to
see. There are two marks given for the diagram alone. There is clear
use of the data (1 + 1) and the answer explains externalities clearly.
There is a clear effect on the third party.

A diagram saves a thousand words.
No evaluation is required on any 5-mark questions. But application is

always needed – at least 2 marks on every question on this paper.

Question 1 (b)
This proved to be a difficult question with a mean mark significantly lower for the equivalent
question in Section B. Most candidates had good understanding of the reasons why price
elasticity might be inelastic and there were some very insightful evaluative comments which
went beyond the generic. The question discriminated well between those who had a secure
grasp of the concept of income elasticity and those whose understanding was less secure.
The key to answering this question well is to explain price inelastic and income elastic
demand in order to get analysis marks. There is no need to define PED and YED. Drawing a
steep demand curve and showing a rise in price, for example, leading to a rise in TR is an
effective way to earn both knowledge and analysis marks. Candidates found it more
challenging to explain the concept of income elastic demand. While most candidates
identified that take-away meals might be normal or inferior goods, there were a few good
explanations of the responsiveness of demand changes when incomes changed.
The highest scoring answers used the data effectively, and could argue evaluatively, for
example that in the global health crisis there were few alternatives, or that when incomes
during that time fell demand rose the effect was to make inferior goods.
This was a slightly above average score, and benefits from gaining the 2/2 application marks.
The diagram is limited in its usefulness, but there is no evaluation.

These were the examiner's annotations:
2K
1AN
2 AP
0 EV
= 5/8
It is useful to remember that for 5 and 8 mark questions there is a

points based system of marking, and there is no point in writing more
to illustrate certain assessment objectives than the marks available.

This is a very effective answer.

Full marks are awarded – note the well written evaluative paragraph at
the end.
Evaluation can be as two single evaluative points or one developed

evaluation point.

Question 1 (c)
This was an accessible question and candidates were well briefed on the consequences of
integration. Effects such as economies of scale and increased market share were popular
with candidates. Good answers tackled the different types of integration explicitly e.g.
horizontal and conglomerate, using the data and a diagram.
This was a good answer, but there were weaknesses which were reflected in the L3 – and L2e
– scores.

L3K L2e-
L3K L2e-
Mid L3K = 7
Low L2e = 3
10 + 3 = 12
Make a limited number of well-developed points and evaluation

arguments, and go beyond two-step chains of reasoning to reach the
top levels.

This is a full mark answer, which could have been shorter and still earned full marks.

Diagrams and data are well integrated.
Using the diagram and data as part of the answer makes this one
stand out.

Question 1 (d)
There were some very good essays which showed good understanding of the
microeconomics of an exchange rate depreciation on the price of imported ingredients, with
many showing a shift in MC as well as AC and a new profit area highlighted. In the macro
context some argued effectively that when there is a depreciation, it is likely that the SRAS
curve will shift left to reflect the rising cost of imported inputs. A few candidates made
explicit links along the lines that a depreciation might increase the popularity of the UK as a
tourist destination and so the demand for restaurant meals might increase. Restaurant
meals are not typically internationally traded and so it was surprising to see the number of
candidates who argued that UK restaurants will sell more meals abroad following a
depreciation, or other reasons for a rise in AD. Nevertheless there were some very well
informed candidates who showed excellent knowledge of recent developments in the UK
economy with regard to the difficulty of attracting staff to this sector.
Micro effects of exchange rate depreciation on the food delivery and/or restaurant sector
were well explained and were often supported by an accurately drawn cost and revenue
diagram showing a rise in AC and MC. The stronger candidates used type of restaurant to
really develop their answers where ingredients would need to be sourced from abroad e.g.
Japanese and Asian restaurants. Macro effects were more challenging in terms of application
to food delivery and/or restaurant sector. Quite a few candidates wrote about how exchange
rate depreciation could lead to food delivery companies increasing their export which was
unconvincing. Candidates who developed the macroeconomics effects using the AD/AS
model, typically with a well explained diagram, were able to offer more developed responses,
which scored higher marks. A reminder to centres that at least one good detailed application
to the context provided (i.e. the restaurant or food delivery services) was required to score
highly. Generic response to the effects of depreciation, tended to score Level 3 KAA. There
was good understanding shown of the Marshall-Lerner condition and J Curve in many
responses.
The micro side of depreciation was best linked to costs, as here. The candidate then links the
costs of food in restaurants to the diagram by making it clear that variable costs shift, and
therefore both MC and AC shift.

This is a good answer but the candidate keeps crossing out work,
which is a problem because of opportunity cost. In this case the chains
of reasoning are not extended fully so this does not reach the very top
of the top levels for KAA and Eval. But at 22/25 there are lessons to be
learned from using the right vocabulary and tools of analysis.
The economics student should not aim for perfection either in terms of
wording or presentation, but instead purity of logic and strength in the
links of the analysis and evaluation.
This is similarly a good answer in terms of logic and the link to costs is again strong. But the
noticeable difference is in terms of the chains of reasoning which stay in Level 3 KAA and
Level 2 Eval. So for example the costs are not linked to the variable costs of food imports for
restaurants, and that is merely assumed.

12 KAA marks and 6 Eval. This was the modal score for this question.
Do not force the examiner to do the work for you. If your costs shift,
say whether they are fixed or variable then link your application to the
diagram that you draw.

Question 2 (a)
Answers were quite weak on the actual theory of the Lewis model. Many were unable to do
more than quote the data references, and specific models have not been requested in the
past so this was probably a surprise for many. Candidates had the general idea although
there were very many blank responses or an inability to articulate the theory well, and those
who did understand tended to score very highly.
Development models have not previously specifically tested and very few could use the
specific Lewis model, even though it had been spelt out in the Advanced Information.

This was a clear answer using the theory, and there is use of the
context of primary production switching to secondary production in
Kenya.

A diagram is not necessary for any development questions.

Those who knew the model wrote some excellent answers – but of those who knew the
model, some did not do enough to gain 3 marks for Knowledge and Analysis as they did not
understand the key point about marginal productivity in the different fields.

Some even tried to evaluate the model (not necessary). Diagrams can
help but they are not necessary for development economics.
Candidates must remember to always include 2 data reference points

(or one combined 2-stage application process) on the 5 mark question.

Question 2 (b)
The question was easily accessible. The three points that distinguished answers were those
who did not know what was meant by demographic factors, and did not deal with
development but merely growth and evaluation. Good answers were often let down by lack
of evaluation. The other concern was often that candidates wrote too much which clearly led
to timing problems later in the paper.
Well answered
Most candidates were able to use the extensive range of data provided well.
Best responses were written really concisely
Follow correct format – Point, evidence, explain, however (twice)
Can achieve full marks in 8 sentences
Lots of candidates spent far too much time and wrote in far too much depth
The main problem with 8 mark examine questions is the lack of evaluation, as here.
This scores 2 K 1 An 1 Ap
= 4/8
Although two numbers are used, there is just one quote reproduced.
There is no calculation or other working of the data, so it scores 1ap.

Use two pieces of data if possible (or do a calculation or manipulation
of the data)
Remember there are two marks for evaluation. Use two simple points,
or a two-step chain of reasoning for 2E.

This is a good example of how to achieve full marks.

This is a short answer that follows the basic formula: point, explain,
example, evaluation x 2
Do not spend a long time on the 8 mark questions. 8 minutes should

be the maximum and a shorter time can produce full marks.

Question 2 (c)
The mark scheme was forgiving and allowed comparative advantage answers to be credited
when they were not the direct line of the question. Those who understood the point about
trade were sometimes confused by the emphasis on absolute advantage. Some candidates
did not attempt the question at all.
Very challenging question which many students left blank or failed to apply the concept of
absolute advantage
Many answers gave vague benefits of higher exports or greater efficiency only – this
answer is not perfect but stands out as one of the best.
Level 3 only achieved when absolute and/or comparative advantage used within the
numerical or diagrammatic analysis.

The diagram and the tables perform the same task, so it is probably
best to stick to the preferred method and develop the reasoning
through one method.
It is encouraging to see Kenya and the Netherlands in the

diagram/table.
Candidates must remember to evaluate – there were quite a few

excellent answers with no attempt at evaluation – max 8/12
This was clearly 12/12

Question 2 (d)
This was the more popular of the essays where, overall, all students demonstrated the basic
knowledge on the impact of low interest rates on AD and costs of borrowing. Only a few of
them, though, managed to bring in good economics and to make their answers more
relevant to the context with real life examples drawn not only from Kenya but also from other
Sub-Saharan countries or BRIC economies. Some mentioned the lengthy process of the
transmission mechanism.
Most candidates who answered it managed two effects.
The main problem was one of timing: some were only able to put down the briefest of
answers. Many candidates are selecting too many essay points – they need to use less points
and to write in more depth on those specific points.
The examiners' advice: that it is better to make one point well rather than a number with
brief or incorrect chains of reasoning.
Accessible essay which most students responded well to

More able students were able to apply a traditional interest rates questions to the LEDC
e.g – use of savings gap
Good answers used AD/AS diagrams within their macro analysis and cost/revenue
diagrams within their micro analysis. This enabled them to analyse effectively and look at
the wider impacts.
Evaluation was most effective when linked to the data extract and the rates actually
available in Kenya
Accessible essay which most students responded well to
More able students were able to apply a traditional interest rates questions to the LEDC
e.g – use of savings gap

Good answers used AD/AS diagrams within their macro analysis and
cost/revenue diagrams within their micro analysis. This enabled
them to analyse effectively and look at the wider impacts.
Evaluation was most effective when linked to the data extract and
the rates actually available in Kenya
Make at least one micro and one macro point. If you have more time
then develop the side you think is the weakest with another more
convincing point. It is better to make fewer points really well argued
than using a scattered approach with several relevant thoughts.

Many answers were pre-learned 'interest rate' essays, and having been learnt in the context
of macro they could not easily switch to micro.

The micro approach is best reinforced using the
price/output/profit/externalities points from the Themes 1 and 3
specification, and either D&S or cost and revenue diagrams should be
expected. The macro side would probably include an AD AS diagram in
a high scoring essay.
Use diagrams as much as you can in the microeconomics and

macroeconomics Theme 3 essays.
Remember to check whether the essay is about causes or effects

before you start.

Question 2 (e)
Q2e was less popular, with the large majority of students unable to make clear links between
growth and development, but many candidates embedded in their answers excellent
economics, theories/models (Harrod-Domar; Lewis Model from the extract; Prebisch Singer
Hypthesis) and even diagrams not in the specifications such as the MEC diagram, plus a wide
range of models from development economics. The weakest candidates could not go beyond
corruption or time lag when evaluating (see comments at the end of this report).
Some candidates did extremely well. The key point was to choose development strategies
rather than to rehearse any macro policy (e.g., monetary policy is not a development policy
and could not gain high KAA marks). It was also important to deal with development rather
than merely growth.
This was a very accessible essay with a huge variety of different strategies chosen
Students seemed well prepared for this (very typical style of question used in the past in
other contexts, e.g. Mozambique)
The best answers not only had depth to their analysis with model/diagrams, but also had
good application to LEDCs (rather than simply writing about general supply-side policies)
Again lots of candidates writing too many points in insufficient depth.
Many candidates ran out of time on the last essay

This is Level 4 L3E L4 L3E with a solid structure. It is not too long but instead focused and
applied throughout.

Diagrams and data are used to good effect.

Remember to give an overall judgement.

The main problem with this essay was pre-learned essays that were unrelated to developing
countries (or one country). Strategies tend to be generic and AD AS diagrams or demand side
policies were included which are not relevant in the context.

9 + 4E
There are three points made, none which get above L3:
Trade liberalisation L3 – E2-
FDI L3 – LE1
Tourism L2 L2E-
There is no overall judgement.
It is better to make two points which are clearly development

strategies and not just a continuation of developed countries'
macroeconomics.

9EC0_03_Sec01
A reminder to centres that it does not benefit candidates to have stock essay answers as they
miss the higher marks by not using the context to guide their analysis and evaluation. It is
helpful if the candidate marks the box for the essay chosen (1d or 1e) but if they do not
(around 10%) then they are marked in a pool where the examiner has to decide which
question has been attempted. The answer usually becomes clear very quickly when
candidates put signals in their work and make it clear from the outset that they understand
the question.
By contrast, this answer started out with a diagram which could not have an effect as a
minimum wage as the horizontal line is below the equilibrium.

Chains of reasoning do not go beyond the two step variety and is Level
2. The points are fair but there is minimal use of data or other context.
There is no evaluation.

Do not reproduce pre-learned essays. Make sure the answer is fully
embedded in the context. Then evaluate both the micro and macro
side – at least one good argument on each side.

This was the modal score for the item.

The diagram shows a NMW not a rise in NMW. The chains of reasoning
are short.
Strong answers go into at least two points at a deep level, using

extended chains of reasoning, tying in the data, and drawing out
balanced conclusions with an overall judgement.

9EC0_03_Sec02
The majority of candidates ran short of time on the essay and the advice to candidates is to
reserve 30 minutes for the final essay, and to use at least one micro and one macro point,
diagrams where possible and all the data that links to the points made. Evaluation is key and
we need to see developed and applied chains of reasoning within the evaluation.
This answer is typical of a pre-learned essay, and it is not focused on development

economics.

The points are generic and simply pre-learned. There is a hint of L3
evaluation at times but the body of the essay is at L2 for KAA.
Use the context to inform the choice of strategies. This is a

development question and it is data response.

This essay is high quality in terms of analysis and application, and there is a solid judgement.

The answer uses the language of economics in the context of the data
given.
Make sure your handwriting is legible. It is good to have such clear

diagrams too.

Paper Summary
Overall candidates had poor literacy skills. This is, perhaps, the legacy of Covid that a two-tier
student body had developed with some churning out answers full of cogent arguments and
robust analysis and others who struggled to articulate their reasoning. Economic terminology
was relatively weak compared to pre-pandemic years. Handwriting seems to have more hard
to decipher than ever.
All items were fair and accessible and differentiated well. The case studies were relevant and
simulating to students.
Examiners have remarked on problems with candidates offering too much generic economic
theory. Some centres are ignoring the advice to make the subject more applied and look at
the real world. Those candidates who have looked at case study material are clearly so much
more engaged and their answers are so much more interesting.
A serious concern was raised regarding the Kenya question: we are much more sensitive to
the colonial legacy – both as teachers and as institutions. Curricula are in the spotlight as
never before and Economics has to be aware as much as English or History do. Blanket
statements and stereotypes that describe African Governments as corrupt must be avoided.
We perhaps need to remind ourselves that the colonial legacy is a constraint to development
in itself. If students want to discuss corruption as a problem, then be specific-based on
independent research on real examples over the course of the two years of study. Kenya, in
this case, is mid-table on corruption tables, and governance cannot be generalised by
continent.
In future the candidates taking this exam should address the following issues:
use the data in every question. This is a data response paper.

use a diagram in the longer questions if you can, even if it is not requested. For example,
the essay question on government spending on public goods, or the essay question on
electric cars, could have positive externalities in consumption, even if not required.
Timing: allow a minute per mark, and this gives 20 minutes reading or correction time. You
can achieve all the marks in this time, and you do not need to fill all the space available.
question spotting does not help. Candidates who think they know how to answer a certain
type of question tend to give generic responses and do not read the data available
explain every step in your chain of reasoning, and have multiple steps

Grade boundaries
Grade boundaries for this, and all other papers, can be found on the website on this link:
https://qualifications.pearson.com/en/support/support-topics/results-certification/grade-
boundaries.html

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with its registered office at 80 Strand, London WC2R 0RL.

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© Pearson Education Ltd 2022

GCE Economics A 9EC0 03 2

3 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 4

5 GCE Economics A 9EC0 03

There are 2 marks for application.

Use a diagram if you can.

GCE Economics A 9EC0 03 6

7 GCE Economics A 9EC0 03

No evaluation is required on any 5-mark questions. But application is

GCE Economics A 9EC0 03 8

9 GCE Economics A 9EC0 03

It is useful to remember that for 5 and 8 mark questions there is a

11 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 12

Evaluation can be as two single evaluative points or one developed

GCE Economics A 9EC0 03 14

15 GCE Economics A 9EC0 03

Make a limited number of well-developed points and evaluation

GCE Economics A 9EC0 03 18

19 GCE Economics A 9EC0 03

21 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 22

GCE Economics A 9EC0 03 26

GCE Economics A 9EC0 03 32

33 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 34

35 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 36

Candidates must remember to always include 2 data reference points

37 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 38

39 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 40

Do not spend a long time on the 8 mark questions. 8 minutes should

41 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 42

It is encouraging to see Kenya and the Netherlands in the

Candidates must remember to evaluate – there were quite a few

GCE Economics A 9EC0 03 46

Most candidates who answered it managed two effects.

Accessible essay which most students responded well to

47 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 52

53 GCE Economics A 9EC0 03

Use diagrams as much as you can in the microeconomics and

Remember to check whether the essay is about causes or effects

GCE Economics A 9EC0 03 54

55 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 56

59 GCE Economics A 9EC0 03

GCE Economics A 9EC0 03 60