Bpp learning Media is an acca approved Content Provider

 
QUICK QUIZ 
BPP Tutor Toolkit Copy

---

PART A: THE BUSINESS ORGANISATION, ITS STAKEHOLDERS AND THE EXTERNAL ENVIRONMENT 
 
120
 
1
The price of the good 
The price of other goods 
Household income 
Taste and fashion 
2
Substitutes are goods that are alternatives to each other (for example, Coke and Pepsi) 
Complements are goods which are bought and used together (for example, cars and petrol) 
3
The price obtainable for the good 
The prices obtainable for other goods, particularly goods in joint supply 
The costs of making the good 
Disruptions such as bad weather and strikes 
4
The price at which the volume of demand and the volume of supply are equal; there is neither surplus 
nor shortage. 
5
C 
Demand curves express the quantity demanded at each given market price. Non-price 
determinants such as income must be held constant when looking at the effect of price 
movements in isolation. 
6
A 
Supply shifts from S
0
to S
1
, reflecting the per-unit tax. Demand shifts from D
0 
to D
1
as the price of 
a substitute (Irish whiskey) rises. 
7
C 
If the price ceiling is above the equilibrium market price, it will not interfere with the working of 
the price mechanism. The market will not be forced from its current equilibrium. A price ceiling 
only affects the workings of the price mechanism if it is set 
below 
the equilibrium price. 
8
B 
A reduction in income tax will increase 'real' household income, and so demand for normal 
products will shift to the right, ie quantity demanded will be greater at any given price. 
A fall in the price of a substitute good would entice consumers away from the original good. This 
would cause a leftward shift in the demand curve. 
A change in the price of the good itself does not cause a shift in the curve but a movement along 
it. 
Complementary products tend to be bought and used together, so an increase in the price of one 
will lead to a reduction in demand for the other, reflected in a leftward shift in the demand curve.