AQA A-Level Economics Paper 2 National and International Economy 2022

AQA A-Level Economics Paper 2 National and International Economy 2022 A-level ECONOMICS Paper 2 National and International Economy Tuesday 2 June 2020 Morning Time allowed: 2 hours Materials For this paper you must have: • an AQA 12-page answer book • a calculator. Instructions • Use black ink or black ball-point pen. Pencil should only be used for drawing. • Write the information required on the front cover of your answer book. The Paper Reference is 7136/2. • In Section A, answer EITHER Context 1 OR Context 2. • In Section B, answer ONE essay. Information • The marks for questions are shown in brackets. • The maximum mark for this paper is 80. • There are 40 marks for Section A and 40 marks for Section B. Advice • You are advised to spend 1 hour on Section A and 1 hour on Section B. This study source was downloaded by from CourseH on :51:39 GMT -06:00 Section A Answer EITHER Context 1 OR Context 2. EITHER Context 1 Total for this context: 40 marks Unemployment and the labour market Study Extracts A, B and C and then answer all parts of Context 1 which follow. Extract A Figure 1: Unemployment and underemployment rates in the UK, 2007–2018 Years Unemployment rate (%) Underemployment rate (%) 2007–08 5.5 7.3 2009–10 7.8 9.6 2011–12 8.0 10.2 2013–14 6.9 10.1 2015–16 5.1 8.8 2017–18 4.2 7.8 Note: Underemployment is where people are working fewer hours than they wish, or in jobs that do not reflect their skills or training Figure 2: Growth in average earnings and CPI inflation rate in the UK, 2008–2018 Source: ONS, 2018 Source: ONS, 2018 Extract B: Unemployment and real wages According to a recent study on wage growth, the youngest worker today would need to wait 1 nearly 80 years to see the average real wage in the UK double from its current level. At just 4.2%, unemployment in the UK is at its lowest level in decades. It should be the best of times, but data from the Office for National Statistics (ONS) show that the percentage of people who are ‘underemployed’, often working on zero-hours contracts, is greater than it was during the 5 financial crisis of 2007–08. Some claim this is the true cause of poor real wage growth. Supply-side reforms to labour markets are meant to boost productivity but can be damaging for some workers. Unregulated labour markets can lead to inequality and poor pay, which also reduces government tax revenue. Workers who are only temporarily employed can experience a lack of stability and firms may have little incentive to invest in human capital. Consequently, 10 these workers may not get the opportunity to develop new skills. Firms may also face higher costs from replacing workers who leave because they feel undervalued. It can be argued that supply-side reforms have gone too far in creating a highly flexible workforce and the government needs to do more in terms of protecting the nation’s workers. There are calls for some restoration of trade union powers, more rights for workers on 15 zero-hours contracts and measures to raise pay to ensure that workers feel the benefits of employment. Source: News reports, 2018