A-LevelEconomicsThe price system and the microeconomy9708/33 · Oct/Nov 2018 · Q171 Mark

The diagram shows the costs and revenue curves in the labour market for a firm in imperfect competition. [Figure 17.1] Initially the firm is at an equilibrium in the factor market. What will happen to the wage rate and employment if a trade union negotiates a wage of W? A fall from W3 to W remain the same at OR B fall from W4 to W increase from OQ to OR C rise from W1 to W increase from OQ to OR D rise from W1 to W remain the same at OQ

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Marking points from the official mark scheme (Oct/Nov 2018). The mark or mark type is shown in brackets.

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Topic: The price system and the microeconomy, A-Level Economics (syllabus 9708). Structured question, 1 mark.
Source: A-Level Economics, Oct/Nov 2018 Paper 3 Variant 3, question 17.

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