Normal Profits, Supernormal Profits and Losses — Edexcel Past Paper Questions

A small hotel in Scarborough has seen its energy bills increase from £2 000 to £8 000 per month. Small businesses do not have the energy management teams of larger companies to negotiate better deals. Evaluate the microeconomic effects of rising energy bills on the hotel industry or an industry of your choice.

One of two options in Section C — candidates answered this or the other.

3.3.2 Costs · 3.3.4 Profits and Losses

Using a cost and revenue diagram, discuss the likely impact of ‘rising costs’ for coffee shops on their profitability (Extract A, line 2).

3.3.2 Costs · 3.3.4 Profits and Losses

With reference to Extract C, discuss the proposed government subsidy to prevent Thomas Cook from reaching its shut-down point.

3.3.4 Profits and Losses · 1.2.9 Indirect Taxes and Subsidies

Discuss factors that are causing many high street retailers in the UK to close some branches or shut down completely. Use a cost and revenue diagram to support your answer.

3.3.2 Costs · 3.3.4 Profits and Losses

Discuss one likely reason for the rise in BT’s profit (Figure 2, Extracts B and C). Use a cost and revenue diagram to support your answer.

3.3.4 Profits and Losses · 3.3.1 Revenue

Discuss the likely impact of the National Living Wage on the profitability of firms. Use a cost and revenue diagram in your answer.

3.5.3 Wage Determination · 3.3.4 Profits and Losses