Please write clearly in block capitals. Centre number Candidate number Surname Forename(s) Candidate signature GCSE ECONOMICS Unit 11 Personal Economics Monday 5 June 2017 Afternoon Time allowed: 1 hour 15 minutes Materials For this paper you may use: a calculator. Instructions Use black ink or black ball-point pen. Fill in the es at the top of this page. Answer all questions. You must answer the questions in the spaces provided. around each page or on blank pages. Do all rough work in this book. Cross through any work you do not want to be marked. For Examiner s Use Question Mark 1 2 3 TOTAL Information The marks for questions are shown in brackets. The maximum mark for this paper is 70. You are reminded of the need for good English and clear presentation in your answers. Quality of Written Communication will be assessed in questions 1(e), 2(c) and 3(c). *JUN1741301101* IB/G/Jun17/E10 413011
2 Answer all questions in the spaces provided. 1 Read Item A and then answer the questions that follow. Total for this question: 28 marks Item A Harry lives at home with his parents. He is an apprentice heating engineer, for which he receives a training allowance of 580 a month. He has about 250 in a savings account. Harry has become interested in keeping fit and has recently joined a gym where he pays the junior membership fee of 12 each month. This fee will increase to 30 each month when he becomes 18 in two months time. The gym is the only one in Harry s town and has good facilities, including a swimming pool, which he uses occasionally. Harry has made many new friends at the gym. The friends train together and encourage each other to improve. Harry has volunteered to help one of these friends run a fitness club for younger students at his old school. Rather than paying for gym membership, Harry s father thinks that it would be better if Harry bought some gym equipment. Harry could turn the unused garage at their house into a gym. He has researched the prices of gym equipment that he would need. Figure 1 Harry s gym equipment research Seller Price Notes High street store Television shopping channel 550 9 monthly payments of 69 Sports shop 569 Internet seller 330 This is a special price only available if Harry takes out and pays with a store card (annual interest rate of 30%). Delivery is free. Equipment will have to be bought tomorrow when it appears on the television channel. There is an additional 20 delivery charge. Payment must be made with the order. Delivery is free. This equipment is second hand and would have to be collected. There is no guarantee given with the equipment. *02*
3 1 (a) (i) How much more expensive is it to buy the gym equipment from the sports shop rather than the internet seller? Tick one of the es next to the amount you think is correct. Tick one only 19 49 220 239 [1 mark] 1 (a) (ii) What is the total price (including delivery) of the gym equipment on the television shopping channel? Tick one of the es next to the price you think is correct. Tick one only 621 641 828 848 [1 mark] 1 (b) Explain two factors that might affect the demand for gym equipment. [4 marks] 1 *03* Turn over
4 2 1 (c) Explain one advantage and one disadvantage to Harry of taking out the store card to buy the gym equipment. [4 marks] Advantage Disadvantage *04*
5 1 (d) There is only one gym in Harry s town. Explain two ways that people in Harry s town might benefit from the competition created if there were more gyms. [6 marks] 1 2 Question 1 continues on the next page *05* Turn over
6 1 (e) Harry s father thinks that it would be better for Harry to buy his own gym equipment rather than to pay for membership at the local gym. Do you believe it makes more sense for Harry to: buy the equipment, or keep paying his gym membership? Recommend to Harry which option you believe would be more suitable. Use Item A to support your choice. [12 marks] *06*
7 28 Turn over for the next question *07* Turn over
8 2 Read Item B and then answer the questions that follow. Total for this question: 20 marks Item B It is 3 years since Harry started gym training and he has reached a high level of personal fitness. Harry has also completed his apprenticeship as a heating engineer, which allows him to service and repair central heating systems. However, he has not yet been able to find a full-time job. A large steel-making business closed down a year ago which caused a big increase in unemployment in the town. Over 1000 jobs were lost at the steel works which had a farreaching impact on Harry s town. The government has tried to help the economy of the town by providing training schemes on how to start up a business. Harry is currently working part time in a call centre. To help make a little extra money, he has agreed to be a personal fitness trainer for two of his workmates. He realises that there is potential to make a living from becoming a full-time personal trainer. This would, however, involve him gaining a suitable qualification at a local college, which would take 2 years. As a qualified fitness trainer he could earn 20 per hour. His net pay would be lower because of a number of deductions. 2 (a) Explain what is meant by net pay. [2 marks] *08*
9 2 (b) Explain two ways in which the people in Harry s town might be affected by high levels of unemployment in the area. [6 marks] 1 2 Question 2 continues on the next page *09* Turn over
10 2 (c) Harry is facing an important decision. Should he: train to be a full-time personal trainer, or continue to look for a job as a heating engineer? Recommend to Harry which of these two choices you believe would be better for him. Use Item B to support your choice. [12 marks] *10*
11 20 Turn over for the next question *11* Turn over
12 3 Read Item C and then answer the questions that follow. Total for this question: 22 marks Item C Fitness Für Alle (FFA) is a German business that operates about 300 gyms in Germany and mainland Europe. The business has a policy of keeping costs as low as possible. This allows the monthly membership fees to be set at an affordable 20 (euros), which is equivalent to about 15. FFA intends to open up gyms in the UK. The plan is to build about 100 gyms, one of these being in Harry s town. FFA would initially bring experienced German gym managers to run the UK gyms. They would be paid an annual salary of 40 000. The German gym managers would recruit other employees locally. These employees would be paid the UK minimum wage and FFA expects that these jobs would be attractive to EU citizens who have moved to the UK in search of work. Customers of the UK gyms would pay a monthly fee of 15. Any profits made in the UK would be then converted into euros and sent to FFA s German owners. This would mean the profits FFA makes on its UK gym membership varied with the exchange rate. The UK government has contacted FFA to encourage the company to invest in Britain. 3 (a) Explain two reasons why overseas firms, such as FFA, might decide to operate in the UK. [4 marks] 1 2 *12*
13 3 (b) Explain two possible effects on FFA if the pound strengthens against the euro. [6 marks] 1 2 Question 3 continues on the next page *13* Turn over
14 3 (c) The UK government believes that the economy benefits from overseas firms opening in the UK. Do you agree that the UK would benefit from overseas firms opening gyms in the UK? Use Item C to support your views. [12 marks] *14*
15 22 END OF QUESTIONS *15*
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