Sizes & types of firms

Using the data provided in Extract D, explain one role of financial markets.

Examine two reasons why retailers on the high street tend to remain small.

Discuss possible methods of price and non‑price competition that firms could use to increase the value of sales on the high street.

EITHER

Evaluate the microeconomic and macroeconomic effects of falling house prices.

Evaluate the microeconomic and macroeconomic effects of labour shortages in the UK, or a developed economy of your choice.

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Explain the likely impact of diminishing marginal productivity of labour on cabin crew staffing levels. Refer to Extract A in your answer.

Examine the likely impact of Thomas Cook’s plan ‘to reduce their airline emissions’ (Extract B, line 6) on the social optimum position. Use an appropriate externalities diagram in your answer.

With reference to Extract C, assess whether Thomas Cook’s failure was caused by the principal-agent problem.

With reference to Extract C, discuss the proposed government subsidy to prevent Thomas Cook from reaching its shut-down point.

With reference to the information provided, discuss the decision by Jet2 to increase its package holiday prices.

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.

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5 ‘Bettys’ is a luxury café, first opened in Harrogate in 1919 specialising in afternoon tea service. Since then it has opened a further five branches in Yorkshire. It has no plans to increase the number of cafés. The six branches have 2 million customers a year.

(Source adapted from: https://www.forbes.com/sites/sarahturner/2018/03/22/the-famed-yorkshire-cafe-that-blends-nostalgia-with-profits-and-conservation/#7eb50cec7a4e)

Explain one likely reason why this business has remained small.

Explain why the previous expansion of this business could be described as ‘organic growth’.

Assume ‘Bettys’ merges with a major tea leaf supplier. Which one of the following is most likely to be an advantage as a result of this merger?

5 ‘Bettys’ is a luxury café, first opened in Harrogate in 1919 specialising in afternoon tea service. Since then it has opened a further five branches in Yorkshire. It has no plans to increase the number of cafés. The six branches have 2 million customers a year.

(Source adapted from: https://www.forbes.com/sites/sarahturner/2018/03/22/the-famed-yorkshire-cafe-that-blends-nostalgia-with-profits-and-conservation/#7eb50cec7a4e)

Explain one likely reason why this business has remained small.

Explain why the previous expansion of this business could be described as ‘organic growth’.

Assume ‘Bettys’ merges with a major tea leaf supplier. Which one of the following is most likely to be an advantage as a result of this merger?

With reference to Extract D line 21, explain why ‘opportunity cost’ is a problem for governments of developing countries when servicing debt.

Examine two reasons, apart from access to finance, why 90% of the manufacturing sector in Mozambique ‘is made up of small enterprises’ (Extract E, line 9).

Discuss whether borrowers benefit from microfinance. Make reference to Mozambique in your answer.

EITHER

Evaluate the microeconomic and macroeconomic factors, apart from access to credit and banking, influencing growth and development in Mozambique.

Evaluate the likely microeconomic and macroeconomic effects of relatively high inflation rates in many African countries.

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