Optional25 marks
Case study · Branded coffee shops
Evaluate the microeconomic and macroeconomic factors that may influence Starbucks’ decision whether to expand in a particular country.
Specification point 3.1.2 · Theme 3
Business growth
Business growth · Business behaviour and the labour market
Questions tagged to this specification point
11 questions
Essay questions
Long-form evaluation and discussion
Data-response questions
Questions built around exam extracts
15 marks
Case study · Digital markets
Discuss the likely benefits of mergers for firms such as Microsoft.
12 marks
Case study · The electronics industry
Discuss the likely concerns of the competition authorities regarding the proposed merger of the two companies referred to in Extract C.
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12 marks
Case study · The energy market
With reference to Figure 2 and Extract B, discuss the possible constraints on business growth for firms supplying energy to households in the UK.
12 marks
Case study · The food delivery industry
With reference to Extract C, discuss the likely effects of increasing integration within the food delivery market.
8 marks
Case study · Energy and telecommunication markets in the UK
With reference to Extract B, examine the likely benefits to consumers of the integration between BT and EE.
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15 marks
Case study · Supermarket price war, food waste and possible mergers
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.
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Short-answer questions
Focused calculations, explanations and diagrams
2 marks
ContextThe 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.
Explain one likely concern the EU competition authorities may have had about the merger.
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2 marks
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.
Explain why the previous expansion of this business could be described as ‘organic growth’.
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Multiple-choice questions
Quick checks of economic understanding
A-level Paper 1, June 2022, Q5(a)Multiple choice
1 mark
ContextThe 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.
Which one of the following best describes the merger of the makers of Fiat cars and Vauxhall cars?
ABackward vertical integration
BForward vertical integration
CHorizontal integration
DOrganic growth
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A-level Paper 1, November 2020, Q5(c)Multiple choice
1 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.
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?
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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