A-level Paper 1, November 2020Markets and Business Behaviour
A-level Paper 1, November 2020, Q5(c)
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?
Multiple choice1 mark
Context
‘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.
AExternal economies of scale will increase efficiency
BGreater control to lower prices of tea
CIndustrial diversification increases risks
DLower monopoly power in the café market
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