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9609 · 3.1.3

Markets — practice questions

Practice and worked examples for 9609 Markets. Short previews only — attempt the full question in MarkScheme against the official scheme.

Worked example 1

UK plant-based milk market: £400 m sales, growing 12% annually, dominated by 3 brands with 70% share. A start-up enters. Discuss two market features that matter.

Show solution outline

Growth (12%): Attractive for entry — rising tide lifts demand; room for new products without stealing static share.

Concentration (3 brands, 70%): High barriers — incumbents have shelf space, brand trust, marketing budgets. Start-up needs niche positioning (3.1.5) or innovation rather than head-on mass marketing.

Worked example 2

The global market for electric vehicles (EVs) had a total sales value of $250 billion in 2022. In 2023, the total sales value grew to $310 billion. 'Tesla Motors', a major firm in the market, recorded sales of $77.5 billion in 2023. Calculate:

  1. The market growth rate for the global EV market from 2022 to 2023.
  2. Tesla Motors' market share in 2023.
Show solution outline

1. Calculate Market Growth Rate:

  • Formula: Market Growth (%) = [(Current Year's Market Size - Previous Year's Market Size) / Previous Year's Market Size] x 100
  • Step 1: Find the change in market size. $310 billion - $250 billion = $60 billion
  • Step 2: Divide the change by the original market size. $60 billion / $250 billion = 0.24
  • Step 3: Convert to a percentage. 0.24 x 100 = 24%
  • Answer: The market growth rate was 24%.

2. Calculate Tesla Motors' Market Share:

  • Formula: Market Share (%) = (Firm's Sales / Total Market Sales) x 100
  • Step 1: Insert the values for 2023. Firm's Sales = $77.5 billion Total Market Sales = $310 billion
  • Step 2: Divide the firm's sales by the total market sales. $77.5 billion / $310 billion = 0.25
  • Step 3: Convert to a percentage. 0.25 x 100 = 25%
  • Answer: Tesla Motors' market share in 2023 was 25%.
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