2022 JC2 H2 Prelims P1 QP

1 © ASRJC Economics Department 9757/01/JC2 Prelim /2022 [Turn Over ECONOMICS 9757/01 Paper 1 30 August 2022 Additional Materials: Answer Booklet 2 hours 15 mins READ THESE INSTRUCTIONS FIRST An answer booklet will be provided with this question paper. You should follow the instructions on the front cover of the answer booklet. If you need additional answer booklet ask the invigilator for a continuation booklet. Please start your answer to each question on a fresh page of the answer booklet. Answer all questions. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 8 printed pages. ANDERSON SERANGOON JUNIOR COLLEGE JC2 PRELIMINARY EXAMINATION Higher 2

2 © ASRJC Economics Department 9757/01/JC2 Prelim /2022 [Turn Over Answer all questions Question 1: Retail troubles Figure 1: Restaurant prices relative to retail prices in the United States, 1929 to 2014 Restaurant prices of food products relative to grocery retail prices, where grocery retail prices are equal to 100 (i.e. 150 would represent a 50% margin on retail prices). Source: https://ourworldindata.org Extract 1: Cost of government regulation will mean higher food prices for consumers The Food and Drink Federation (FDF) has today warned that consumers will inevitably face higher food and drink prices if manufacturers are forced to absorb the cost of proposed government policies during the next few years. The FDF has estimated that if the cost of forthcoming government policies were passed on directly to consumers, it would increase the price of food and drink per household. According to estimates, the government’s proposals could lead to an increase in food and drink spending of nearly 7%. The FDF calculates that the cost to the food and drink industry of proposed UK government policies around public health and sustainability is at least £8 billion. The FDF is calling on the government to reconsider these policies and their unintended consequences, as well as fundamental reforms to the UK’s regulatory architecture, in order to ensure future policy is effective and well-targeted. It also argues that in the long -term any additional costs will likely increase indebtedness, reduce competitiveness, and see investment decline, particularly at a time when businesses are seeking to recover from a difficult period of economic uncertainty. Source: Food and Drink Federation, 20 July 2021 Extract 2: Aldi may drop prices to compete with Tesco’s new budget venture Jack’s Low-cost supermarket chain Aldi "will never be beaten on price” and could even drop them in response to Tesco's new low-cost venture Jack's, it said today. UK and Ireland chief executive Giles Hurley said Aldi welcomes competition from new players such as Ja