A-Level Economics Model Answers
Explain why the prices of grains such as corn and wheat were rising in the extract.
Here is a question and answer from the microeconomics section of the A-level Economics syllabus.
This question is an ‘explain’ question - the type of question students need to where you need to demonstrate your knowledge of economics with theory and diagrams. This is usually an applied question, so you also have to apply your knowledge in context.
I have seen so many capable students drop a few marks on these sorts of questions simply because they don’t apply their knowledge to the question.
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Explain why the prices of grains such as corn and wheat were rising in the extract. Use your economic analysis and a diagram to explain your answer.
Also use the extracts which you can find here
The question asks you to study the extract and examine why grain prices have risen over time. Therefore, you must use your economic knowledge and apply it to the extract. The question also demands a diagram so you cannot finish this answer without drawing one!
You can add some background knowledge if you want to, but it may not get you more marks. If you want the maximum marks in the shortest amount of time, you must try and stick to the question. You can get full marks on this question within 1 page of writing.
FREE Model Answer Guide
Possible Definitions
Why have grain prices risen?
Arguments For Free Market
Look at Extract A - notice the price of crude oil is rising, but the price of grains are also rising. Why might that be?
Look at Extract B - there are some clues in there as to why grain prices are rising. How can we use the theory of derived demand to answer this?
Look at Extract B again - there is some information there about the relationship between cattle feed, biofuels and crude oil. How can we use the theories of joint supply and cross elasticity of demand to answer this question?
Draw a diagram - try to extend your answer a bit by explaining what is happening in the diagram. Explain how the price adjusts in the market from P1 to P2 (to a new equilibrium).
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