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problem 1:

a) With the help of an appropriate ex, define the principle of diminishing returns.
b) In brief describe the main funds available for long-term capital for a limited liability company.

problem 2: By using an illustration of your own choice, and with the help of diagrams, show how supply and demand analysis can describe:

a) Changes in price and output when a new competitor joins the market.
b) The effect of cheaper air travel to tourist resorts in Europe.

problem 3: Describe to what extent the growth of the family market has affected eating and drinking out at pubs and restaurants.

problem 4: Describe the implications of the given for the hospitality industry:

a) UK interest rates retained at low levels.
b) Reductions in government borrowing.
c) The £ Sterling to euro exchange rate falls.
d) The rate of inflation falls.

problem 5:

a) Define by using exs, what is meant by the oligopoly market.
b) describe the advantages of economies of scale to a large restaurant chain.
c) Describe the significance of bed and breakfast hotels in a traditional seaside location.

problem 6:

a) describe under what circumstances a company in the hospitality sector might consider a conglomerate merger.
b) With the help of illustrations, describe the benefits of a company achieving growth via franchising.

problem 7: The UK economy is now in a so-called double-dip recession and the Bank of England has continued to maintain low interest rates to try and encourage consumer spending. In addition, the £ Sterling is stronger against other currencies, specifically the euro, making it less attractive for holidays abroad for British holidaymakers. Assess how the hospitality industry might respond to such circumstances.

problem 8: A number of restaurant chains adopt a differential pricing policy to raise profits. With the use of illustrations, describe the reasons and effects of the given price differential policies:

a) A two-for-one offer for set adult meals.
b) Cheaper meals for senior citizens at specified times of the day.

Public Economics, Economics

  • Category:- Public Economics
  • Reference No.:- M94410

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