How is the introduction of the sugar tax is likely to affect the carbonated drinks market?

A shift in the supply curve to the left.

Government subsidies would cause:

A shift in the supply curve to the right

A warm British summer is likely to result in what impact on the ice cream market?

A shift in the demand curve to the right.

Describe the relationship between supply and demand shown in the diagram.

A competitor has entered the market: an increase in supply.

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Edexcel A Level Business - 1.2 The market - Theme 1

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#Edexcel A Level #Business - 1.2 The market - Theme 1

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Questions 13

Answers

1
The formula for income elasticity of demand (YED) is:
YED = % Δ Qd / % Δ Y x 100
YED = % Δ Qd x % Δ Y
YED = % Δ Qd / % Δ Y
YED = % Δ Y / % Δ Qd
2
How is the introduction of the sugar tax is likely to affect the carbonated drinks market?
A shift in the demand curve to the left.
A shift in the supply curve to the left.
A shift in the demand curve to the right.
A shift in the supply curve to the right.
3
Government subsidies would cause:
A shift in the supply curve to the right
A shift in the demand curve to the right
A shift in the demand curve to the right
A shift in the supply curve to the left
4
If incomes rise by 5% and demand for a good rises by 20%, what is the YED?
-0.25
4
0.25
-4
5
The formula for price elasticity of demand (PED) is:
PED = % Δ Qd x % Δ P
PED = % Δ P / % Δ Qd
PED = % Δ Qd / % Δ P
PED = % Δ Qd / % Δ P x 100
6
A good with a negative income elasticity of demand is referred to as:
Superior
Normal
Inferior
Luxury
7
A warm British summer is likely to result in what impact on the ice cream market?
A shift in the demand curve to the left.
A shift in the supply curve to the right.
A shift in the demand curve to the right.
A shift in the supply curve to the left.
8
Describe the relationship between supply and demand shown in the diagram.
Consumer incomes rise: an increase in demand.
A competitor has entered the market: an increase in supply.
A competitor has left the market: a fall in supply.
Consumer incomes fall: a fall in demand.
9
Which product is likely to have the lowest income elasticity of demand?
Bus travel
Fine wines
Designer clothing
Sports cars
10
If the price of a good is reduced by 10% and demand increases by 20%, what is the PED?
0.5
20
-2
10
11
Which of the following is not likely to result in a change in supply?
promotion and branding
changes in the costs of production
government subsidies
introduction of new technology
12
A good with a price elasticity of demand of -1.2 could be described as:
Slightly price inelastic
Very price inelastic
Slightly price elastic
Very price elastic
13
Which of the following is not likely to result in a change in demand?
advertising and branding
changing costs of production
changes in the prices of substitutes and complementary goods
external shocks

Edexcel A Level Business - 1.2 The market - Theme 1 Flashcards | StudBud