In 2017, the UK added bicycle helmets to its consumer prices index (CPI) calculation for the first time. Many bicycle retailers now give customers a choice of bicycle helmets. Estimates suggest that 25 million bicycle helmets are sold worldwide each year, and the number sold is increasing steadily.
(a)[2]
Define choice and provide one example.
(b)[4]
Explain how the CPI is worked out.
(c)[6]
Analyse the possible causes of the rise in global demand for bicycle helmets.
(d)[8]
Discuss whether increasing sales of a product would or would not benefit a firm.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Choice means selecting from alternative options and it involves opportunity cost.” …