Question:

5 Serbia is the world’s second largest producer of raspberries, a product with elastic demand.
Consumers experience the economic problem when buying raspberries. Few raspberry farm
workers are members of trade unions. Membership of trade unions in Serbia had fallen to 20% of
all workers by 2020. In that year, Serbia had more state pensioners than workers.
(a) Identify two determinants of price elasticity of demand. [2]
(b) Explain how the economic problem results in consumers having to make choices. [4]
(c) Analyse why some workers decide not to join a trade union. [6]
(d) Discuss whether or not a government should reduce the amount of money it gives to each
state pensioner. [8]

Sample Answers: