Lucy imports high quality pasta from Southern Italy for sale at his delicatessen in Stafford.
The exchange rate between the pound (£) and the euro (€) is important for Lucy.
She buys 100 kg of pasta every month. The price of pasta is €5 per kg.
Pasta is made from wheat.
In 2019, good weather led to a large increase in the wheat harvest.
Which of the following is the most likely effect of this increase?
Select ONE answer:
- The price of wheat will fall.
- Lucy will have to pay more for her pasta.
- The cost of wheat will rise.
- The demand for wheat will fall.
Show the workings to arrive at your answer, and explain and justify your reasons:
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This multiple-choice question is suitable for Business Studies KS4 & KS3 classes
The answer is 1
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