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6 (a) State one fixed cost that Sports Tours Ltd will need to pay - Edexcel - GCSE Business - Question 6 - 2021 - Paper 1

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6 (a) State one fixed cost that Sports Tours Ltd will need to pay. (b) Outline one likely impact of changing levels of consumer income on Sports Tours Ltd.

Worked Solution & Example Answer:6 (a) State one fixed cost that Sports Tours Ltd will need to pay - Edexcel - GCSE Business - Question 6 - 2021 - Paper 1

Step 1

State one fixed cost that Sports Tours Ltd will need to pay.

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Answer

One fixed cost that Sports Tours Ltd will need to pay is the salaries of the tour operators. This remains constant regardless of the number of tours conducted.

Step 2

Outline one likely impact of changing levels of consumer income on Sports Tours Ltd.

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Answer

If there is an increase in consumer income, consumers are more likely to spend on leisure activities such as sports tours. This could lead to an increased demand for tours offered by Sports Tours Ltd, allowing the company to expand its services and potentially increase profit margins. Conversely, if consumer income decreases, people may choose to stay local rather than spending on tours, which could result in decreased sales for Sports Tours Ltd.

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