Edexcel A Level Economics A Paper 1: Markets and business behaviour June 2024 question paper 9EC0/01

The table below shows price elasticity of demand for bus tickets in London 2021

(Source adapted from: https://assets.publishing.service.gov.uk/government/uploads/ system/uploads/attachment_data/file/669090/youth-travel-concessions-price-elasticity.pdf and https://tfl.gov.uk/fares/find-fares/bus-and-tram-fares#on-this-page-4)

Explain one likely reason for the difference in the price elasticity of demand for the 18+ student bus ticket and the adult bus ticket.

In 2021, the adult 7-day bus ticket was £21.90. Bus ticket prices in London in 2022 increased by 4.8%. Ceteris paribus, which one of the following is the percentage decrease in the 7-day bus ticket demand by adults?

The table below shows price elasticity of supply for housing in the US in 2020.

(Source adapted from: https://bankunderground.co.uk/2020/02/25/ the-declining-elasticity-of-us-housing-supply/)

With reference to the data above, explain one likely reason for the difference in the price elasticity of supply.

In Texas the price elasticity of supply is +1.8. Which one of the following is the percentage increase in price if the quantity of housing supplied in Texas is increased by 12%?

Peloton is a firm which makes exercise bikes. Peloton’s objective is to prioritise selling fitness services rather than to achieve short-term profit maximisation.

(Source adapted from: https://www.forbes.com/sites/shelleykohan/2022/01/26/ peloton-prioritizes-access-and-acquisition-over-profits/?sh=13d8ee474f40)

Draw a cost and revenue diagram to illustrate the different business objectives: profit maximisation and revenue maximisation.

If Peloton changes its objective to sales maximisation, then without making a loss, it operates at an output where:

In 2022 the government announced that the maximum undergraduate tuition fee for universities in England will remain at £9 250 per year for the next two years.

(Source adapted from: https://questions-statements.parliament.uk/ written-statements/detail/2021-10-21/HCWS339)

Explain one likely reason for the maximum price for an undergraduate university programme.

Which one of the following is an example of government failure associated with the maximum price?

With reference to the information on the preceding page, explain the market structure of mortgage lending in the UK.

The value of all mortgage loans was £1 601 billion at the end of 2020.

Which one of the following is the value of Lloyds’ market share?

With reference to Extract A, explain the likely reasons for the change in price of electronic devices. Include a supply and demand diagram in your answer.

Examine two factors which might influence the supply of labour in the electronics industry.

Assess whether firms in the electronics industry benefit from economies of scale.

Discuss the likely concerns of the competition authorities regarding the proposed merger of the two companies referred to in Extract C.

With reference to Extract D, discuss possible methods of government intervention to reduce electronic waste.

A small hotel in Scarborough has seen its energy bills increase from £2 000 to £8 000 per month. Small businesses do not have the energy management teams of larger companies to negotiate better deals.

(Source adapted from: https://www.ft.com/content/d07797e7-2eb7-4240-b15d-692b39510def)

Evaluate the microeconomic effects of rising energy bills on the hotel industry or an industry of your choice.