Competition policy and regulation of firms

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.

The makers of Fiat cars merged with the makers of Vauxhall cars in 2021. Fiat management had aggressively sought a merger to achieve economies of scale. The competition authorities in the EU investigated the merger.

(Source: adapted from https://www.thedrive.com/news/34856/ the-merged-fiat-chrysler-and-peugeot-group-will-be-called-stellantis)

Which one of the following best describes the merger of the makers of Fiat cars and Vauxhall cars?

Explain one type of internal economies of scale that the newly merged car company may achieve.

Explain one likely concern the EU competition authorities may have had about the merger.

Using the information provided, explain the market structure that best describes the hand car wash (HCW) industry in the UK.

Examine two reasons why the demand for HCWs increases during a period when consumer ‘incomes fail to keep up with inflation’ (Extract A line 8).

Discuss the likely effects of changes in the level of migration on firms such as HCWs in the UK. Use a labour market diagram and the information provided to support your answer.

EITHER

Evaluate the microeconomic and macroeconomic factors which determine the number of firms in an industry. Refer to HCWs or another industry of your choice.

Evaluate the microeconomic and macroeconomic effects of increased government intervention in an industry. Refer to HCWs or another industry of your choice.

Write your answer here:

Refer to Figure 1. Explain the likely effect of the change in subsidy levels between 2017 and 2018 on rail fares.

Include a supply and demand diagram in your answer.

With reference to Figure 2, examine two possible factors which may have influenced demand for rail travel since 2008.

Assess whether complete nationalisation of the rail industry might protect employees.

With reference to Extract A, paragraph 3, discuss whether the rail network can be considered to be a natural monopoly.

Discuss the likely benefits of price discrimination to rail passengers. Use a diagram to support your answer.

Refer to Figure 1. Explain the likely effect of the change in subsidy levels between 2017 and 2018 on rail fares.

Include a supply and demand diagram in your answer.

With reference to Figure 2, examine two possible factors which may have influenced demand for rail travel since 2008.

Assess whether complete nationalisation of the rail industry might protect employees.

With reference to Extract A, paragraph 3, discuss whether the rail network can be considered to be a natural monopoly.

Discuss the likely benefits of price discrimination to rail passengers. Use a diagram to support your answer.

With reference to Extract A, explain the difference between a positive statement and a normative statement.

With reference to Extract B, examine the likely benefits to consumers of the integration between BT and EE.

With reference to Extract C, assess possible reasons why many ‘landline-only’ customers do not switch to a cheaper telephone provider.

Discuss one likely reason for the rise in BT’s profit (Figure 2, Extracts B and C). Use a cost and revenue diagram to support your answer.

Discuss methods of government intervention to protect consumers within the utilities markets, such as energy and telecommunications.

With reference to Figure 1, explain one likely reason for the overall trend in the real price of gas and electricity.

With reference to Extract A, discuss the likely effectiveness of ‘measures to open up and increase competition’ in the UK energy market.

With reference to Extract B, assess how the regulation of energy suppliers’ profits is likely to affect consumers and suppliers in the energy market.

The price elasticity of demand for electricity in the UK is estimated to be –0.35 in the short run and –0.85 in the long run.

With reference to Extract A and your own knowledge, examine two possible reasons for the change in price elasticity of demand for electricity over time.

With reference to Extract C and your own knowledge, discuss policies businesses and government might implement to reduce labour immobility to benefit the energy sector.

With reference to Figure 1 and Extract A, explain one likely reason for the change in the four-firm concentration ratio of the supermarket sector between 2010 and 2015.

With reference to Figure 2 and Extract A, discuss the possible impact of supermarket monopsony power on both food suppliers and consumers.

Examine measures the government might use to restrict the monopsony power of supermarkets.

Assess the extent to which ‘information gaps’ (Extract B, lines 5 and 6) and ‘irrational behaviour’ (Extract B, line 11) are the main causes of food waste in the UK.

Discuss the likely problems for Sainsbury’s and Morrisons if the suggested merger between them goes ahead. Refer to Figure 1, Extract C and your own knowledge in your answer.