Can u answer all

OPEN ENDED QUESTION

China will become the worlds largest luxury good market

With their fast-rising incomes, Chinese consumers will overtake those in todays rich economies to become the worlds biggest spenders on luxury goods. They will rebalance their budgets in a gradual move from saving to consuming.

Wi

1. In your opinion, are luxury goods normal goods or just not necessities? Explain your answer

(5 marks)

After wild weather, higher food prices on horizon

After heavy rain this year, the corn harvest will be less than expected while the demand for corn will continue to increase. Food prices will continue to rise.

Wi

2. Using the demand and supply model, explain why food prices are expected to rise.

(5 marks)