AQA GCSE Economics: Free trade, the EU and globalisation (8136) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions cover sections 3.2.4.3 Free-trade agreements including the European Union and 3.2.4.4 Globalisation: benefits and drawbacks in the AQA GCSE Economics (8136) specification for first teaching from September 2017. There are no tiers. Firms, countries and numbers are made up. For explanations, see the study guide and revision notes. Other links: the AQA GCSE Economics hub, the checklist and the free diagnostics.

Questions

1. Define free trade. [1]

2. Distinguish between a tariff and a quota. [2]

3. Country J imports washing machines priced at 300 units. It then imposes a tariff of 15%. (a) Calculate the new price of an imported washing machine. [1] (b) Explain one effect of the tariff on domestic producers of washing machines. [2]

4. Explain two benefits to a country of joining a free-trade agreement. [4]

5. Explain one argument against free trade. [3]

6. Explain how new technology has contributed to globalisation. [3]

7. Define a multinational company. [1]

8. Explain one benefit and one drawback of globalisation for workers in a less developed country. [4]

9. Explain one drawback of globalisation for UK workers. [3]

10. A UK clothing retailer buys from factories abroad that pay very low wages. Explain one ethical issue this raises. [3]

11. “Globalisation has been good for UK consumers but bad for UK workers.” Evaluate this statement. [9]

Answers

1. Trade between countries without barriers such as tariffs or quotas [1]. [1]

2. A tariff is a tax on imports [1]; a quota is a limit on the quantity of a good that can be imported [1]. [2]

3. (a) 300 × 1.15 = 345 units [1]. (b) Imports become dearer, so domestic machines are more price-competitive [1]; domestic producers may sell more and protect jobs [1]. [3]

4. Any two developed: exporters gain tariff-free access to members’ markets [1], so they can sell more and grow [1]; consumers get cheaper imports [1] and more choice [1]; the country may attract investment [1] from firms wanting access to the whole market [1]. [4]

5. Any one developed: domestic industries may not compete with cheaper imports [1], so firms close [1] and workers become structurally unemployed [1]; or infant industries need protection [1] until they can compete [1], otherwise they fail before they grow [1]. [3]

6. The internet and better communications make it cheap to contact suppliers and customers worldwide [1]; container shipping cuts transport costs [1], so firms can produce and sell across many countries [1]. [3]

7. A company that operates in more than one country [1]. [1]

8. Benefit: new jobs from MNC investment [1], often paying more than local alternatives [1]. Drawback: some jobs have low pay or poor conditions [1], and local firms may be pushed out [1]. [4]

9. Firms may move production to countries with lower costs [1], so factories in the UK close [1], leaving workers whose skills may not match new jobs unemployed [1]. [3]

10. The low price to UK shoppers depends on workers abroad being paid very little [1]; the retailer may be seen as exploiting them [1], and consumers may question whether it should check its suppliers’ wages and safety [1]. [3]

11. Consumers:

• Lower prices because goods are made where costs are lowest [1].
• Wider choice of goods from around the world [1].
• But supply chains can be disrupted, and some people value locally made goods [1].

Workers:

• Some UK workers lost jobs when production moved abroad [1], especially in manufacturing [1].
• But others gained jobs in export industries and in MNCs based in the UK [1], and in services the UK sells abroad [1].

Judgement: The statement is partly true: consumers have gained widely, while the effect on workers depends on the industry, so it is too simple to say globalisation is bad for workers as a whole [1] [1]. [9]

Where marks are usually lost

• Confusing tariffs with quotas.
• Listing benefits and drawbacks without saying which group is affected.
• Writing about globalisation in general when the question names a particular country or group.
• Missing the moral or ethical angle when the question asks for it.

Frequently asked questions

What is the difference between free trade and a free-trade agreement? Free trade is trade between countries without barriers such as tariffs and quotas. A free-trade agreement is a deal between a group of countries to remove or reduce those barriers between themselves, while each may keep barriers against non-members.

Is the EU still on the AQA GCSE Economics specification after Brexit? Yes. Section 3.2.4.3 names free-trade agreements “such as the EU”, so you should know the significance and benefits of EU membership as an example, and you can use the UK’s departure in 2020 as context.

How do I calculate the price of an import after a tariff? Multiply the original price by (1 + the tariff rate). A 15% tariff on a 300-unit good gives 300 × 1.15 = 345 units.

What do examiners mean by moral, ethical and sustainability considerations? Issues such as low wages and poor conditions in overseas factories, child labour, and the environmental cost of transporting goods long distances. Explain who is affected and why it matters.

Next steps

• Revise with the revision notes and re-read the study guide.
• Check coverage on the checklist and see the AQA GCSE Economics hub.
• Take one of the free 10-minute diagnostics.

Official syllabus

AQA GCSE Economics (8136) specification, for first teaching from September 2017, published by AQA: sections 3.2.4.3 Free-trade agreements including the European Union and 3.2.4.4 Globalisation: benefits and drawbacks.