Eduqas A Level Economics
Eduqas A Level Economics Non-UK Economies: The European Union Exam Questions
Free Eduqas A Level Economics revision for Non-UK Economies: The European Union: what you need to know, common mistakes and exam-style questions with answers. Covers EU membership and enlargement, economic and monetary union, the euro, the European Central Bank and optimal currency areas.
Practise Non-UK Economies: The European Union with past papers
Once you have learnt this topic, find the Non-UK Economies: The European Union questions in real Eduqas A Level Economics past papers and mark them with the mark scheme. Doing lots of real questions is the quickest way to learn how examiners ask about each idea.
About Eduqas A Level Economics Non-UK Economies: The European Union
The European Union is the named non-UK economy in the Trade and Development section of the Eduqas specification. You need to analyse and evaluate the advantages and disadvantages of membership for existing and prospective members, and whether further EU expansion benefits old and new members. You also study economic and monetary union (EMU): its structure, the role of the European Central Bank, and the benefits and drawbacks of a single currency, judged against the criteria for an optimal currency area. Examiners like questions that ask whether the euro has been a success, so use examples such as the eurozone debt crisis and differences in performance between member states.
What you need to know
- The EU The EU is a customs union and single market, with free movement of goods, services, capital and people and a common external tariff. Members follow common rules on trade, competition and many regulations.
- Benefits of membership Tariff free access to a large market, economies of scale, more competition, inward FDI, labour mobility to fill skills shortages and regional funding for poorer areas.
- Costs of membership Loss of national control over trade and some regulation, budget contributions, the common external tariff raising import prices from outside the EU (trade diversion), and possible pressure on wages from migration.
- Enlargement Expansion brings new markets and labour for existing members and investment and growth for new members, but can mean large migration flows, more competition for regional funds and harder decision making.
- EMU and the European Central Bank Eurozone members share the euro and a single monetary policy set by the European Central Bank, whose main aim is price stability. National governments keep control of fiscal policy, within EU rules.
- Optimal currency area A single currency works best when members have similar economic cycles, flexible labour markets, mobile factors of production and fiscal transfers between regions. If not, one interest rate may suit some members but not others.
Common mistakes in Non-UK Economies: The European Union
- Confusing the EU with the eurozone. Not all EU members use the euro.
- Listing only benefits of a single currency. Evaluate the loss of independent monetary and exchange rate policy, especially during asymmetric shocks.
- Ignoring trade diversion. A customs union can switch imports from cheaper non-members to dearer members.
- Treating the UK as currently in the EU. Write about EU membership in general terms and the experiences of current members.
Try three Non-UK Economies: The European Union exam-style questions
1. State two features of a customs union. (2 marks)
Show the mark scheme answer
Free trade (no tariffs) between members; a common external tariff on imports from non-members.
2. Explain two benefits to a firm of its country adopting the euro. (4 marks)
Show the mark scheme answer
No transaction costs from converting currencies, lowering costs of trading with other eurozone members; no exchange rate risk within the eurozone, making planning and investment easier; (or price transparency increasing competition).
3. Evaluate whether the eurozone meets the conditions of an optimal currency area. (15 marks)
Show the mark scheme answer
A strong answer would explain the conditions (synchronised cycles, labour mobility, wage flexibility, fiscal transfers); analyse evidence for (high trade integration, free movement of labour); and against (different cycles and competitiveness, language barriers to mobility, limited fiscal transfers, the eurozone debt crisis where one interest rate did not suit all); judge that it only partly meets them.
Non-UK Economies: The European Union FAQs
What does Eduqas A Level Economics Non-UK Economies: The European Union cover?
It covers the advantages and disadvantages of EU membership and enlargement, economic and monetary union, the role of the European Central Bank and the euro judged against optimal currency area criteria.
Which component is the European Union examined in?
It can appear in Components 1 and 2, and it is part of the Trade and Development content assessed in the essay section of Component 3.
What examples should I use for the EU?
Use the eurozone debt crisis to show the problems of one interest rate for different economies, and enlargement to central and eastern Europe to show the effects of expansion on migration and investment.
