Car market and Supermarket market

Question 1

Demand in car market

Answer 1

Shift to electric cars

Demand in NICs due to emerging middle class

Question 2

Supply in car market

Answer 2

Issue with natural resources

Trade rules block movement of cars

Question 3

Government intervention

Answer 3

$1.8bn subsidy for zero emissions and infrastructure
$500m for 170k jobs
End of sale of petrol/diesal by 2030

Question 4

External costs

Answer 4

Pollution, congestion, visual and noise pollution

Question 5

Market sharesq

Answer 5

10.1 ford
9.9 vw
9.5 bmw
6.5 mercedes
4 firm conc = 36

Question 6

MandAs

Answer 6

Benz and Chrysler - $38bn

Nissan/Mitsubushi - 2.3bn

Fiat and Chrysler 10bn

Question 7

New firms

Answer 7

Tesla, Lucid, NIO

Question 8

Price competition

Answer 8

Ford dropping prices of electric
Mustang match to pound
Nissan leaf non price competition

Question 9

Supermakret concentration

Answer 9

tesco 28
Sainsbury 16
Asda 16
Morrisons 11
Aldi 8
Coop 6
Lidl 5
Waitrose 5
Other 7

Question 10

Externalities:

Answer 10

Positive; more choice, job opportunities, high competition

Negative: pollution, congestion in rural areas
Rising farm and animal production
Lowe rprice - demerit goods

Question 11

CMA

Answer 11

2008 Tesco prevented landlrods letting property to other supermarkets - CMA forced to take action for land agreements and avoid future agreement

2021 - 6 supermarkets had land reviewed and CMA found breaches

2008 merger blocked between sainsbury and asda
-£12bn merger blocked as meant high prices, pay more in shops, online pay more, petrol stations and overcrowding

Question 12

What is GCA

Answer 12

Grocery code adjuster - can fine 1% of turnover if break codes of conduct

Aldi and Sainsbury perform well - tesco and morrisons not so much

Question 13

government intervention

Answer 13

500m euro to milk producers by EU to prevent monopsony

Question 14

Non price competition

Answer 14

location, discounts, loyalty, online, new products and choice, advertising