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Pearson Edexcel Level 3 GCE Economics B Advanced PAPER 1: Markets and how they work QP MAY 2024
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Pearson Edexcel Level 3 GCE Economics B Advanced PAPER 1: Markets and how they work QP MAY 2024
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Advanced
PAPER 1: Markets and how they work
Pearson Edexcel Level 3 GCE Economics B Advanced PAPER 1: Markets and how they work QP
MAY 2024
Instructions
•• Use black ink or ball-point pen.
Fill in the boxes at the top of this page with your name,
•• Answer
centre number and candidate number.
all questions.
Answer the questions in the spaces provided –
there may be more space than you need.
Information
•• The total mark for this paper is 100.
The marks for each question are shown in brackets
• be used.
– use this as a guide as to how much time to spend on each question. Calculators may
Advice
• Read
• Try
each question carefully before you start to answer it.
to answer every question.
• Check your answers if you have time at the end.
Turn over
P80957A
©2024 Pearson Education Ltd.
F:1/1/1/1/
, Answer ALL questions.
SECTION A
DO NOT WRITE IN THIS AREA
Read the following extracts (A–E) before answering Question 1.
Write your answers in the spaces provided.
Extract A
TUI Group lose market share to Jet2holidays
The TUI Group (TUI) has finally responded to being overtaken by Jet2holidays as the UK’s largest
tour operator.
TUI Chief Executive Sebastian Ebel said: “We want to be the market leader not only in
numbers but also in quality. We want to grow stronger than our competitors.” 5
The firm aims to take market share from rivals by broadening its product offering and looking
beyond its traditional core package-holiday customers. It is targeting the larger and higher growth
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segments of the leisure market, such as accommodation only,
flight only, car hire, tours and experiences.
Sebastian Ebel referred to these potential new customers as ‘energised adventurers’ and 10
‘travelistas’. Energised adventurers are older, confident, more affluent and adventurous
holidaymakers interested in culture and exploration. Travelistas are younger, independent and
adventurous travellers who spend less on a holiday but travel more often.
TUI reported record holiday bookings for summer 2023 and 2024 now that global travel restrictions have
been lifted for consumers. 15
(Source: adapted from https://travelweekly.co.uk/news/air/jet2-has-done-very-well-filling-
gap-thomas-cook-left-says-tui-chief)
Extract B
Statement of comprehensive income of TUI Group Q3 2023 and Q3 2022
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Q3 2023 (€m) Q3 2022 (€m)
Revenue 5 286.0 4 433.2
Cost of sales 5 018.4 4 313.4
Gross profit 267.6 119.8
Operating profit/(loss) 52.5 (331.2)
(Source: adapted from: https://www.tuigroup.com/en-en/investors/news/2023/
ir-news/20230809)
2
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, Extract C
TUI hails return to profit but warns of €25m additional costs from Rhodes’ wildfires
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The package holiday operator TUI has enjoyed its first profitable April to June since before the
global health crisis but warned that it expects €25m additional costs from last month’s wildfires in
Rhodes. TUI had to evacuate 8,000 customers which represented 20%
of its customers on the island. 5
“The financial impact of the wildfires in recent weeks covering cancellations, customer compensation,
repatriation flights and welfare costs has added €25m additional costs to our full year 2023 results,”
the company said.
TUI said that Rhodes accounted for about 5% of its summer holiday offering this year,
and while bookings had been affected straight after the wildfires in Rhodes and southern 10
Europe, they had recovered quickly. It predicted summer bookings would still be 6% higher than
last year.
(Source adapted from: https://www.theguardian.com/business/2023/aug/09/tui-hails- return-to-
profit-but-warns-of-25m-hit-from-rhodes-wildfires)
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Extract D
UK Interest (base) Rate (%) January 2022 – August 2023
(%
Base Rate 5.25%
)
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
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1.5
1.0
0.5
0.0
Jan Mar May Jul Sep Nov Jan Mar May Jul
2022 2023
(Source: adapted from https://www.bankofengland.co.uk/monetary-policy/the-interest-rate-
bank-rate)
3
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