Evaluate the likely effects of fluctuations in sugar prices on a sweet company.

Increase in price of sugar will lead to a rise in production costs for the sweet company as it is a factor of productionResponse: reduce supply/ raising price (inward shift of supply on diagram)General points : Fall in producer surplus (can be shown on diagram), fall in employment, reduction in profits
IMPORTANT: EVALUATION!!!Price elasticity of demand: if inelastic then the producer can pass it onto the consumer Extent of price rise Ceteris paribus?
TOP MARKSThey could reduce the % of sugar in each sweetForward-buying

Related Economics A Level answers

All answers ▸

How do I provide a good evaluation point for something I agree with?


Why does the demand curve slope downwards?


Discuss two ways in which a country's international competitiveness could increase (8)


Evaluate the view that attempts by governments to eliminate market failure by intervening in markets for public goods and merits goods will inevitably lead to government failure.


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2025

Terms & Conditions|Privacy Policy
Cookie Preferences