In Saudi Arabia, cement output has increased because the construction industry has demanded more cement for houses, schools, hospitals and roads. Cement prices, export bans and mergers between cement firms are also influencing the market.
(a)[2]
Define the term ‘demand’.
(b)[4]
Explain two reasons why a country may want to limit exports.
(c)[6]
Analyse how information about the price elasticity of demand for its product can affect a firm's pricing decisions.
(d)[8]
Discuss whether a merger between two firms in the same industry is likely to lower the product’s price.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A desire or willingness to purchase a product” …