A Level

Economics B

SPECIFICATION MAPPING
Staying with or switching to Pearson Edexcel Economics B
Please note: Information within this document relating to AS Level Economics B is no
longer applicable because the qualification is no longer available
Switching to Pearson Edexcel
Economics B

Contents
Introduction 2
What is Economics B? 2
What are students required to study in A level Economics? 2
Economics B overview 5
Content 5
Assessment 5
Mapping to the 2008 specifications 5
Specification map: from 2008 Pearson Edexcel
Economics & Business 6
Specification map: from 2008 Pearson Edexcel
Economics 9
 A level Economics B specification maps

Introduction

Economics B is a new qualification for 2015. It would be a suitable successor to our

2008 Economics & Business qualification.
Whether you are thinking of staying with or switching to Pearson Edexcel for the
2015 specifications, this document is an easy reference guide to help you identify
key comparisons and differences between the specifications.
The Getting Started Guide for AS and A level Economics B – available free on the
Economics B pages of the Edexcel website – includes detailed coverage of the
principles behind all the changes and the support available to help you deliver the
new courses from 2015.

What is Economics B?
In Economics B students apply economic theory to real-life business contexts to
help them understand the complexities of the world around them. Students also
use data to help them analyse markets and economies, and how governments try
to influence both. Students use economic theory to explain events and develop an
understanding of the strategies employed by businesses in responding to these
events.
Business contexts are integrated throughout the course to provide a contextualised
approach to economics, with less emphasis on abstract models and more emphasis
on real-world case studies. This demonstrates how economics can be used to
understand the business world, and how the business world provides relevance and
engagement to the study of economics.
This approach was pioneered by the Nuffield Foundation.

What are students required to study in A level Economics?

All Economics specifications must meet the content requirements set out in the
Department for Education’s subject content document (which can be found on the
DfE website). This content has been updated for the new specifications and the
boxes below highlight the key requirements.
The following requirements apply to both AS and A level Economics specifications:

AS and A level specifications must require students to:

● develop an understanding of economic concepts and theories through a
critical consideration of current economic issues, problems and institutions
that affect everyday life
● develop analytical and quantitative skills in selecting, interpreting and using
appropriate data from a range of sources
● explain, analyse and evaluate the strengths and weaknesses of the market
economy and the role of government within it
● develop a critical approach to economic models of enquiry, recognising the
limitations of economic models
● understand microeconomic and macroeconomic market models; use the
models to explore current economic behaviour; make causal connections;
and develop an understanding of how the models shed light on the economy
as a whole
● be aware of the assumptions of the model of supply and demand; explain the
way it works using a range of techniques; and use the model to describe,
predict and analyse economic behaviour

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A level Economics B specification maps

● develop an understanding of the benefits of markets and the reasons why

they may fail; understand the implications of market failure for individuals,
firms and government; and recognise the possibility of government failure
● use the aggregate demand/aggregate supply (AD/AS) model and data to
understand why supply-side and/or demand-side policies may be seen as
appropriate ways of managing an economy
● consider the possible impact of macroeconomic policies; recognise the issues
governments face in managing the macroeconomy; argue for different
approaches; and identify criteria for success and evaluate effectiveness
● develop the ability to apply and evaluate economic models as represented in
written, numerical and graphical forms; interpret and evaluate different types
of data from multiple sources; and propose and justify possible responses to
economic issues.

All AS and A level specifications must cover the following core knowledge,
understanding and skills:
Economic choices and markets
Scarcity and choice: the basic economic problem, opportunity cost, specialisation
and trade.
How competitive markets work: allocation of resources, the objectives of
economic agents, supply and demand, elasticity.
Market failure and government intervention: externalities, alternative methods of
government intervention, government failure.
The national and global economy
The determination of output, employment and prices: circular flow of income,
expenditure and output, aggregate demand and aggregate supply.
Economic policy objectives and indicators of macroeconomic performance:
for example, economic growth, employment, inflation, the balance of payments;
potential policy conflicts and trade-offs.
The global context: international trade, exchange rate changes.
The application of policy instruments: the nature and impact of fiscal, monetary,
exchange rate and supply-side policies.

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 A level Economics B specification maps

The following requirements also apply to A level Economics specifications:

A level specifications must require students to:

● develop an understanding of the role and impact of the financial sector
● recognise the assumptions, relationships and linkages of the possible impacts
of macroeconomic policies
● apply and evaluate economic concepts, theories, methods and models to a
wider range of contexts.
A level specifications must also cover the following core knowledge,
understanding and skills:
Economic choices and markets
● Scarcity and choice: the margin.
● How competitive markets work: productive and allocative efficiency, the
interaction of markets.
● Competition and market power: business objectives, market structures and
their implications for the way resources are allocated, interdependence of
firms.
● Labour market: wage determination, labour market issues, government
intervention.
● Market failure and government intervention: market power, information
asymmetries.
The national and global economy
● Financial sector: the role of the financial sector and its impact on the real
economy, financial regulation, role of central banks.
● Economic policy objectives and indicators of macroeconomic performance:
income distribution and welfare.
● The global context: globalisation, trade policies and negotiations.

Students are also expected to accomplish the following quantitative skills as part of
their AS and A level study:

● calculate, use and understand ratios and fractions

● calculate, use and understand percentages and percentage changes
● understand and use the terms mean, median and relevant quantiles
● construct and interpret a range of standard graphical forms
● calculate and interpret index numbers
● calculate cost, revenue and profit (marginal, average, totals)
● make calculations to convert from money to real terms
● make calculations of elasticity and interpret the result
● interpret, apply and analyse information in written, graphical and numerical
forms.
Note: emboldened skills are not a requirement in the AS level.

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A level Economics B specification maps

Economics B overview
Our Economics B specifications have been developed to ensure the revised subject
content and assessment requirements for economics (as outlined on pages 2 to 4)
are met, and to bring the specifications up-to-date. Highlights from each theme are
introduced below.

Content
Theme 1 introduces students to the economic problem, market failure and
government intervention. Highlights include: consumer choices and enterprise in
the economy; the market economy and how market forces shape the way in which
firms meet consumer demand; and the role of banks in the economy.
Macroeconomic policy is introduced in Theme 2, and students are introduced to the
economic cycle and the global economy. Highlights include: how consumers are
influenced by and respond to changes in prices and incomes; small firm survival in
competitive markets; and an introduction to developed, emerging and developing
economies.
Building on Theme 2 content, students develop their understanding of the global
context in Theme 3. The content has broadened to developing economies such as
Africa. Students are also introduced to global labour markets and inequality and
redistribution. Highlights include: the impact of globalisation and expansion into
new markets; global employment; and poverty and inequality.
Theme 4 has a greater focus on market failure and macroeconomic policies,
building on knowledge and understanding from Theme 1. Students are also
introduced to risk and the financial sector. Highlights include: market power;
market failure and macroeconomic policies; and the Global Financial Crisis.

Assessment
The AS and A level papers have been designed to ensure the assessments are clear
and consistent, enabling students to understand the skills they are required to
demonstrate without overly focusing on exam technique. These include:
 A reduction in the variety of command words used, careful definition of the
skills that comprise each command word, and consistent application of the
command words within and across assessments.
 Skills-based mark schemes that focus on the qualities students are required to
demonstrate in their answers, rather than the quantity of points within
responses. Clarity of the skills comprising each command word reflects how
teachers and examiners describe the qualities of student work, so the
expectations are clear for teachers and for markers, reducing subjectivity.
 Short-answer questions that focus on knowledge, understanding and
application. These ensure the integration of assessment objectives within
questions so they are not considered in isolation, support the application of
knowledge to real-business contexts, and require students to demonstrate a
holistic understanding of economics through making connections between their
knowledge of economic theories and concepts and business contexts.
 A focus on the skills required for progression to university and employment
within the pre-released context.

Mapping to the 2008 specifications

This guide maps the current (2008) Pearson Edexcel Economics & Business and
Economics specifications to the new (2015) Economics B specifications to support
your planning and delivery of the new specifications.
The specifications must be referred to as the authoritative source of information.

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 A level Economics B specification maps

Specification map: from 2008 Pearson Edexcel

Economics & Business

This specification map is intended to demonstrate possible links in content from the
2008 Economics & Business specification. The approach to and emphasis of the
content is not necessarily the same. The Economics B specifications must be
consulted to determine the appropriate breadth and depth of study for the new
qualification.

2015 Pearson
2008 Pearson Edexcel specification Edexcel
specification
Unit Section Topic
1 1.3.1 Characteristics of entrepreneurs -
What motivates entrepreneurs? 1.2.2

Leadership styles -

1.3.2 What makes a market? 1.3.2

What should firms supply?
Identifying what consumers want or need 1.3.1, 1.3.3
1.3.3 Researching demand for the business idea 1.3.5

Is there a market for the business idea? 1.3.5

Positioning the business idea 1.3.6

Product trial -
Opportunity costs of developing one business 1.1.1, 1.1.3
idea as opposed to another
1.3.4 Current economic climate 1.2.5
1.3.5 Sources of finance 1.4.2, 1.4.3

1.3.6 Estimation of sales levels, costs and profit 1.6.1

Break-even revenue level 1.6.2

Measurement of profit 1.6.3

1.3.7 Creation of a business plan -

2 2.3.1b The nature of markets -

Changes in demand and supply 1.3.3

Changes in price 1.3.3, 2.2.2
Price elasticity of demand 2.2.1

Changes in income 2.2.4

The purpose of marketing in changing markets 2.2.2
2.3.2b How does competition affect the market? 2.2.2, 2.2.3
Different market structures 4.1.1, 4.1.2, 4.1.3

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A level Economics B specification maps

2.3.3b Different types of organisational structures -

How managers can get the best from their staff -

Productivity and efficiency 2.3.1, 2.3.2

Lean management 2.3.3

2.3.4b Reasons for bigger businesses 2.1.1
How increasing size affects cost 2.1.1
How size affects market power 4.2.1

Small is beautiful 2.1.5

2.3.5b Causes of uncertainty 4.5.1

Why uncertainty is a problem -

How businesses can try to reduce uncertainty -

2.3.6b What is the economic cycle? 2.5.1, 2.5.2

How does inflation affect us all? 2.5.3

What is unemployment and how does it affect us 2.5.4

all?
What is structural change? 3.5.1
What are the implications for business? -

3 3.3.1 Product or market conditions that may prompt a 3.1.2, 3.1.3, 3.2.1
business to trade internationally
3.3.2 What will be the likely impact of the growing 3.1.1
economic power of China and India on
individuals, national and multinational firms in
the 21st century?

3.3.3 Assessment of country markets 3.2.2

Comparative advantage and the role of 3.1.2

specialisation by countries

3.3.4 Responsibility to stakeholders 3.4.2

Social/cultural differences in doing business 3.3.2
The purpose of tariffs, laws, import quotas 3.1.4
3.3.5 Global industries 3.3.1

Global marketing -

Global niche markets 3.3.1

3.3.6 Benefits that multinationals bring to overseas 3.4.1
countries
Potential negative impact of multinationals on 3.4.1
overseas countries
Can multinational firms be controlled? 3.4.3
4 4.3.1b What market failure means 1.5.1, 4.2.1, 4.3.1

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 A level Economics B specification maps

What externalities are and how they affect an 1.5.1, 4.3.2

economy
To what extent are externalities acceptable? 1.5.1
What the government can do about it 1.5.2, 4.3.3
4.3.2b Why regulation is needed 4.2.1, 4.2.2
What the government does 4.2.2

The effects of these policies and the implications 4.2.1, 4.2.3

for business

4.3.3b What the government does 4.4.1, 4.4.2, 4.4.3

The effectiveness of government action 4.4.4
4.3.4b Why the government redistributes wealth 3.6.1, 3.6.2, 3.6.3,
3.6.4
How and why the government intervenes to 4.3.1, 4.3.2, 4.3.3
regulate behaviour. The extent to which
government should intervene.

The implications for business 4.3.3

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A level Economics B specification maps

Specification map: from 2008 Pearson Edexcel

Economics

This specification map is intended to demonstrate possible links in content from the
2008 Economics specification. The Economics B specifications must be consulted to
determine the appropriate breadth and depth of study for the new qualification.

2015 Pearson
2008 Pearson Edexcel specification Edexcel
specification
Unit Section Topic
1 1.3.1 Scarcity 1.1.1
Production possibility frontiers -
Specialisation and the division of labour 1.2.4
Free market and mixed economies -
Positive and normative economics -
1.3.2 Movement along the demand curve 1.3.1
Shifts in the demand curve 1.3.1
Price, income and cross elasticities of demand 2.2.1, 2.2.4
1.3.3 Movement along the supply curve 1.2.2
Shifts in the supply curve 1.2.2
Price elasticity of supply -
1.3.4 Determination of market equilibrium 1.3.3
Consumer and producer surplus -
Functions of the price mechanism 1.3.4
1.3.5 Price mechanism 1.3.3
Indirect taxes and subsidies 1.3.2
1.3.6 Demand and supply of labour 3.5.2, 3.5.3
1.3.7 Market failure 1.5.1, 4.2.1, 4.3.1,
4.3.2
Externalities 4.3.2
Public goods -
Imperfect market information -
Labour immobility -
Unstable commodity markets -
1.3.8 Methods of government intervention 1.5.2
1.3.9 Government failure 1.5.2
2 2.3.1 Economic growth 3.1.1

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 A level Economics B specification maps

Inflation 2.5.3
Employment and unemployment 2.5.4
Balance of Payments -
Measures of development – HDI 3.1.1
Other measures of development -
2.3.2 National income -
Income and wealth -
Injections and withdrawals -
2.3.3 The components of AD: C + I + G + (X – M) 2.5.2, 4.4.1
Consumption (C) 2.5.2
Investment (I) 2.5.2
Government expenditure (G) 2.5.2
Exports – Imports (X – M) 2.5.2
Movements along and shifts of the AD curve 2.5.2, 4.4.1
2.3.4 Aggregate supply 2.5.2, 4.4.1
Movements along and shifts of the AS curve 4.4.1
2.3.5 Equilibrium level of output 4.4.1
The multiplier 4.4.1
2.3.6 Actual and potential growth 3.1.1
Causes and constraints on growth -
Benefits of growth -
Costs of growth -
2.3.7 Current macroeconomic objectives 2.6.1
Conflicts between objectives 2.6.3
2.3.8 Demand-side policies 2.6.2, 4.4.2
Supply-side policies 2.6.2, 4.4.2
2.3.9 Conflicts resulting from the use of policy 2.6.3
instruments
3 3.3.1 Objectives 1.1.2
3.3.2 Company growth 2.1.1, 2.1.2
3.3.3 Revenue 1.6.1, 4.1.4
3.3.4 Costs 1.6.1, 4.1.4
Economies and diseconomies of scale 2.1.1
3.3.5 Productive and allocative efficiency 2.3.1, 2.3.2, 2.3.3,
2.3.4, 4.1.5
3.3.6 Normal and supernormal profit -
Profit maximisation -

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A level Economics B specification maps

3.3.7 Barriers to market entry and exit 4.1.2

3.3.8 Market concentration 4.1.3
3.3.9 Perfect competition 4.1.1
Monopoly 4.1.1
Monopsony -
Oligopoly 4.1.3
Monopolistic competition 4.1.1
3.3.10 Contestability 4.1.2
3.3.11 Government intervention to maintain 4.2.2, 4.2.3
competition in markets
4 4.3.1 Causes of globalisation 3.1.2
Effects of globalisation 3.1.1
4.3.2 Patterns of trade 3.1.2
Specialisation and comparative advantage 3.1.2
WTO 3.1.4
Restrictions on free trade 3.1.4
Protectionism 3.1.4
4.3.3 Balance of Payments -
Current account deficits and surpluses -
Influences on exchange rates -
Changes in exchange rates 3.1.5
Monetary union 3.1.5
4.3.4 Measures of competitiveness -
Factors influencing competitiveness -
Government policy -
4.3.5 Absolute and relative poverty 3.6.1
Measurements of inequality 3.6.1
4.3.6 Limits to growth and development -
4.3.7 Macroeconomic policies 4.4.2
Public expenditure -
Taxation -
Public sector borrowing and public sector debt -
4.3.8 Ways of promoting growth and development 3.6.2

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