section A e answering questions 1 Read the source material carefully befor nufacturing industry d by just 1. Driving the changes in the car mai ‘oduced in 2017, over 50% of jominated by Japanese Bia” 1% of global sales. which were produce t Toyota. It produces Around 72 million cars were pr 10 companies. The global car market is d over 10 million cars each year and captures over 9 including two in the UK. Oth in the UK er major car Toyota has production plants all over the world producers including Nissan and Honda also have factories y of t in the world. According to the Societ ft UK factories in 2017, arily the The UK automotive industry is the 10th larges Motor Manufacturers and Traders (SMMT), 1.67 million cars lef decline of 3% compared with the year before. The SMMT said the fall was prim: s worried about future economic conditions avings and borrow result of lower demand from UK consumers and further rises in interest rates. Buyers of cars often withdraw s: money from commercial banks to make their purchases. However, despite this decline, car manufacturing in the UK remained high by historical standards. UK factories saw production of motor vehicles increase by 45% between 2012 ‘and 2016. The number of cars produced per worker also increased significantly, partly because the industry replaced the jobs of some less skilled employees with new capital equipment. Over the same period, the wages of the lowest paid car workers fell by 7.5%, according to data from the UK Office of National Statistics. Manufacturers say that reduced wages and hours were among deals struck with trade unions during the economic recession in 2008/9 to protect UK jobs and factories from closures as demand fell. In comparison declining car sales in Europe forced the closure of a number of car plants in Germany France, Belgium and Italy.The global car industry is now undergoing significant change. The development of electric, connected and potentially driverless cars is having a powerful impact on the Way established, volume car makers organize their operations. Its forcing them to work with software and battery producers and is creating opportunities for many smaller automobile and parts manufacturers Answer all parts to Question 1. Refer to the source material in your answers. A. Identify three ways of measuring whether an industry in a country is large or small. (3) B. Explain, using information from the extract, why wages in the UK car industry fell. [2] C. Using information from the extract, explain how trade union membership may benefit workers. (4] D. Analyse two reasons, referred to in the extract, why a decrease in employment may increase labour productivity. [4] E. Using information from the extract, explain two functions of commercial banks. [4] F. Discuss whether a government should protect a declining car industry. [5] G. Discuss whether small car manufacturers can compete successfully with large car manufacturers.section B Answer any three questions. answer you may refer to this Each question is introduced by stimulus material. In your material and/or to other examples that you have studied. 2. Over the last 50 years, rapid growth in the use of electronic changed how consumers pay for goods and services. Electronic payment i ‘Ss reduced the use of cash and cheques making payments more secure and reducing cost: to business of cash management and handling. They have also increased financial inclusion. The number of people with bank deposit and savings accounts and bank loans has increased. A. Identify two influences on the amount people save. B. Explain why notes and coins are money. C. Analyse the role that commercial banks can perform in an economy. [6] D. Discuss whether poor people are more likely to borrow than rich people. [8] 3. The factor resources available to an economy will determine its output of economic goods. The relationship between resources and output can be shown on a production possibility curve diagram. For example, growing demand for meat free, vegetarian and vegan diets is changing the way resources are being used in food production and processing in many countries. Many existing suppliers of vegan foods are new and relatively small, but the expanding market is creating opportunities for growth. The price elasticity of demand for different types of foods has also been changing over time. A. Define economic good. B. Explain two economic concepts shown by a production possibility curve diagram. [4] ¢. Analyse why demand for a product may become more price elastic over time. [6] D. Discuss whether the growth of a firm is advantageous for both the firm } and consumers.these measures will depend in large part on the price elasticity of supply of these | products and the responsiveness of consumer demand. A. Define price elasticity of supply. [2] B. Explain two reasons why the supply of apples may decrease. [4] C. Apples are a close substitute for pears. Use diagrams to analyse the effect a rise in the price of apples will have on the market for pears. [6] D. Discuss whether governments should only impose indirect taxes on products for which consumer demand is price inelastic. 5. About half the land in Nigeria used to be covered in trees. Today all but about 10% of those trees have been cut down. The deforestation rate in Nigeria has been among the highest in the world along with Honduras, The Phillipines and Benin. It is seen as evidence of market failure by some economists who want the sector to be regulated by governments. A, Define regulation. [2] [4] B. Explain how resources are allocated in a market economic system. C. Analyse the causes of market failure. D. Using examples, discuss whether or not an economy will benefit from cutting down its forests. FEE EEOC EA AOI IOI