A-Level Edexcel Economics A How Markets Work: Cobalt is a key metal used in th

Question

Cobalt is a key metal used in the batteries of electric cars. China is the world’s largest producer of electric cars but has recently cut subsidies to its manufacturers.

The Democratic Republic of the Congo (DRC) produces more than 60% of the world’s supply of cobalt, from its small-scale mines. Many new small mines opened in 2018 as a result of improved expectations of profit.

The following graph shows the price of cobalt between June 2018 and June 2019.

(a) With reference to the information provided, draw a supply and demand diagram to show why the price of cobalt fell between June 2018 and June 2019.

(b) Between June 2018 and June 2019 the price of cobalt fell by:

□ 25%  
□ 37.5%  
□ 62.5%  
□ 166.7%

Cobalt is a key metal used in the batteries of electric cars - Edexcel - A-Level Economics A - Question 2 - 2021 - Paper 1

Worked Solution & Example Answer:Cobalt is a key metal used in the batteries of electric cars - Edexcel - A-Level Economics A - Question 2 - 2021 - Paper 1

Between June 2018 and June 2019 the price of cobalt fell by:

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