Possible supply-side policy measures include education and training, labour market reforms, lower direct taxes, deregulation, improving incentives to work and invest, and privatisation. How supply-side policy measures may enable the government to achieve its macroeconomic aims. Review of Unit 4 Questions and suggested answers

7.7 Growth and survival of firms 7.7.1 reasons for different sizes of firms 7.7.2 internal growth of firms: organic growth and diversification 7.7.3 external growth of firms – integration (mergers and takeovers): • methods of integration: – horizontal – vertical (forwards and backwards) – conglomerate • reasons for integration • consequences of integration 7.7.4 cartels: • conditions for an effective cartel • consequences of a cartel 7.7.5 principal–agent problem arising from differing objectives of shareholders/owners and managers 7.8 Differing objectives and policies of firms 7.8.1 traditional profit-maximising objective of firms 7.8.2 an understanding of other objectives of firms: • survival • profit satisficing • sales maximisation • revenue maximisation 7.8.3 price discrimination – first, second and third degree: • conditions for effective price discrimination • consequences of price discrimination 7.8.4 other pricing policies: • limit pricing • predatory pricing • price leadership 7.8.5 relationship between price elasticity of demand and a firm’s revenue: • in a normal downward sloping demand curve • in a kinked demand curve video links to key topics

PPT aligned to the CIE syllabus. Summative and formative assessments provided with suggested solutions. Topics covered included the PPC scarcity, opportunity costs, efficiency etc.

5.3.1 What profit is and why it is important: • How a profit is made • Importance of profit to private sector businesses, e.g. reward for risk-taking/enterprise, source of finance • Difference between profit and cash 5.3.2 Income statements: • Main features of an income statement, e.g. revenue, cost of sales, gross profit, profit and retained profit • Use simple income statements in decision making based on profit calculations (constructing income statements will not be assessed) *Questions and suggested answers"

5.4.1 The main elements of a statement of financial position: • The main classifications of assets and liabilities, using examples 5.4.2 Interpret a simple statement of financial position and make deductions from it, e.g. how a business is financing its activities and what assets it owns, sale of inventories to raise finance (constructing statements of financial position will not be assessed) Questions and suggested answers*

Including engaging in collective bargaining on wages, working hours and working conditions; protecting employment and influencing government policy. Factors influencing the strength of trade unions. From the viewpoint of workers, firms and the government. *Unit 3 review Questions with suggested solutions

3.4.1 Justify marketing strategies appropriate to a given situation: • Importance of different elements of the marketing mix in influencing consumer decisions in given circumstances • Recommend and justify an appropriate marketing strategy in given circumstances 3.4.2 The nature and impact of legal controls related to marketing: • Impact of legal controls on marketing strategy, e.g. misleading promotion, faulty and dangerous goods 3.4.3 The opportunities and problems of entering new foreign markets: • Growth potential of new markets in other countries • Problems of entering foreign markets, e.g. cultural differences and lack of knowledge • Benefits and limitations of methods to overcome such problems, e.g. joint ventures, licensing *Unit 3 review sample questions and answers

5.5.1 Profitability: • The concept and importance of profitability 5.5.2 Liquidity: • The concept and importance of liquidity 5.5.3 How to interpret the financial performance of a business by calculating and analysing profitability ratios and liquidity ratios: • Gross profit margin • Profit margin • Return on Capital Employed • Current ratio • Acid test ratio 5.5.4 Why and how accounts are used: • Needs of different users of accounts and ratio analysis • How users of accounts and ratio results might use information to help make decisions, e.g. whether to lend to or invest in the business Questions and suggested answers

Causes and impacts of differences in income; productivity; population growth; size of primary, secondary and tertiary sectors; saving and investment; education; and healthcare. Questions and suggested answers

The key terms associated with market failure: public good, merit good, demerit good, social benefits, external benefits, private benefits, social costs, external costs, private costs. With respect to public goods, merit and demerit goods, external costs and external benefits, abuse of monopoly power and factor immobility. Examples of market failure with respect to these areas only. The implications of misallocation of resources in respect of the over consumption of demerit goods and goods with external costs, and the under consumption of merit goods and goods with external benefits. Note: demand and supply diagrams relating to market failure are not required. Market failure review - PPT Supply and demand review - PPT Questions and suggested solutions doc

Why people work and what motivation means • The benefits of a well-motivated workforce: labour productivity, reduced absenteeism and labour turnover • The concept of human needs, e.g. Maslow’s hierarchy • Key motivational theories: Taylor and Herzberg 2.1.2 Methods of motivation: • Financial rewards, e.g. wage, salary, bonus, commission and profit sharing • Non-financial methods, e.g. job enrichment, job rotation, teamworking, training, opportunities for promotion • Recommend and justify appropriate method(s) of motivation in given circumstances Sample questions and answers

PPT aligned to the CIE syllabus. Summative and formative assessments provided with suggested solutions. Topics covered included scarcity, opportunity costs, factors of production etc.