CIMA BA1 - Fundamentals of Business Economics

Signals to consumers about costs

Signals to producers about consumer preferences

A substitute for barter

A means of allocating scarce resources

An increase in the number of buyers and sellers in a market

A lowering of entry barriers separating markets

Informative advertising giving way to persuasive advertising

Employers making greater use of the Internet to advertise job vacancies

a shortage in the market

a surplus in the market

excess demand for the good

an increase in the demand for the good

Cheaper procurement via on line search and ordering

Reduced transport costs from internet buying

Lower entry barriers by reducing the need for expensive premises

Reduced transactions costs leading to low variable costs

average fixed cost will remain constant over the whole range of output

average variable cost will fall over the whole range of output

average total cost will initially fall and then rise as output is increased

average total cost will fall until constant returns to scale achieved

A fall in the price of chicken meat

A fall in the prices of turkey meat

An outbreak of salmonella infection in chicken meat

The publication of a health report urging people to eat white rather than red meats

(i), (ii) and (iii) only

(ii), (iii) and (iv) only

(iii), (iv) and (v) only

(i), (v) and (vi) only

There are few close substitutes for salt

Salt is a small proportion of household expenditure

Salt is a necessity

Supply rises quickly if demand rises because salt is easy to make

Market supply is price inelastic

Market demand is price inelastic

Market supply is price elastic

Market demand is price elastic

Higher price, more sold, fall in revenues of cheese makers

Higher price, less sold, fall in revenues of cheese makers

Higher price, more sold, rise in revenues of cheese makers

Higher price, less sold, rise in revenues of cheese makers