Competition between several bicycle-hire businesses in a town pushes down the price of hiring a bicycle. Many local office workers hire a bicycle every day to travel to work. What is the most likely effect on these office workers?
Their pay may be cut as the hire businesses reduce their costs
Their weekly pay may rise because each hire now costs less
Their real income may fall because hire businesses earn less per hire
The same weekly pay may buy more, so their real income may rise
149 exam-style questions on AQA GCSE Economics 1.5 Competitive and concentrated markets, covering 1.5.1a The range of market structures, 1.5.1b Distinguishing between market structures, 1.5.2a Characteristics of a competitive market, 1.5.2b How producers operate in competitive markets, 1.5.2c The economic impact of competition, 1.5.3a Characteristics of a non-competitive market, 1.5.3b How producers operate in non-competitive markets, 1.5.3c Monopoly and oligopoly, 1.5.4a The labour market and wage determination, and 1.5.4b Gross and net pay. Each one has a worked solution and a mark scheme showing where the marks go.