Economics 0455 · IGCSE · Price elasticity of demand (PED)
Price elasticity of demand (PED) — practice question
A heatwave in July 2013 in the United Kingdom caused ice cream sales to more than double. More workers were recruited to cope with the stronger demand. Over the last few years, changes in the demand and supply conditions for ice cream have made both demand and supply more elastic. The market has also been affected by government policies and by shifts in the country’s economic growth rate.
(a)[2]
Define the term ‘supply’.
(b)[4]
Explain two ways in which a government might affect the price of a product.
(c)[6]
Analyse why demand for a product might become more price elastic.
(d)[8]
Discuss whether the wages of all workers are likely to rise during a period of economic growth.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Readiness to sell” …