Question:

2 (a) From 2030, most new car production in the United Kingdom (UK) will be of electric cars.
Excluding the price of electric cars, explain the determinants of demand for electric cars and
consider which of these determinants is likely to be of greatest significance at the present
time. [8]
(b) Assess whether cross elasticity of demand is likely to be more important in determining the
demand for electric cars than income elasticity of demand. [12]

Sample Answers: