UK students often take jobs during their holidays and some save part of their income to pay their tuition fees. UK graduates earn, on average, £8500 a year more than non-graduates. Economics graduates had the second highest average earnings of all UK graduates in 2016. The top 10% of economics graduates earned £115000 a year.

Mark scheme

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

1. [1] Income / money received by a factor of production
2. [1] received from working / payment to workers
3. [1] includes wages/salaries
4. [1] overtime payments / bonuses / commission
5. [1] income from other sources e.g. undertaking financial investment / renting / running a business
6. [1] Accept any valid non-wage factor
7. [1] with a valid explanation
8. [1] e.g. Short working hours (1) would increase leisure time (1)
9. [1] Job security (1) reduces stress (1)
10. [1] Promotion chances (1) increase wages in long run (1)
11. [1] Fringe benefit / example (1) explanation of fringe benefit / explanation of example (1)
12. [1] Qualifications / skills / education (1) allow an individual to choose an appropriate occupation (1)
13. [1] Graduates are skilled / more knowledgeable
14. [1] have high levels of qualifications/training/education
15. [1] productive / efficient
16. [1] demand for their services is high
17. [1] demand is inelastic
18. [1] supply is low
19. [1] long period of training required
20. [1] supply is inelastic
21. [1] Graduates tend to work in jobs with high pay/position/responsibility/stress
22. [1] example
23. [1] An economics degree is held in high esteem as a qualification
24. Up to 5 marks for why they might:
25. [1] On average people in developed countries have a higher income
26. [1] so are more able to save
27. [1] or more able to save larger amounts so may gain a higher interest rate
28. [1] There tends to be a greater range of financial institutions in developed countries
29. [1] more secure financial institutions
30. [1] this gives greater confidence in saving
31. [1] People in some developed countries may have a culture of saving
32. [1] e.g. Japan
33. [1] Inflation rate may be lower in developed countries
34. [1] enabling people to save more of their income
35. Up to 5 marks for why they might not:
36. [1] The lack of a developed welfare system in some developing countries
37. [1] means that some people may save more for e.g. their old age / retirement / future health problems
38. [1] There may be greater confidence about economic prospects in some developed countries
39. [1] encouraging people to spend more
40. [1] The rate of interest may be lower in some developed countries
41. [1] reducing the incentive to save
42. [1] Some people in developing countries are richer than some people in developed countries
43. [1] Some people in developing countries may save more to spend on higher education to increase the opportunity to work abroad