Weak N5 Econ area

What is seasonal unemployment?

Unemployment that occurs at certain times of the year when demand for labour falls (e.g., ski instructor).

What is structural unemployment?

Unemployment caused by the decline of an industry, leaving workers with outdated skills (e.g., coal mining).

Give two characteristics of a recession.

Rising unemployment; falling consumer confidence. Falling GDP

What is a recession?

Two consecutive quarters of negative economic growth.

Give one positive and one negative effect of raising the retirement age.

Positive: more workers → higher output. Negative: higher costs for firms adapting workplaces

Raising the retirement age increases the number of people in work (ID), which increases output in the economy (EXP).

It also reduces government spending on pensions (ID), allowing more money to be spent on services such as education (EXP).

However, firms may face higher costs (ID) because they need to adapt workplaces for older workers, such as providing more health checks (EXP).

Give one advantage of EU membership.

No trade barriers → increased export opportunities. One advantage of EU membership is that firms can trade freely with other EU countries without tariffs (1), which increases export opportunities (1).

Give one disadvantage of EU membership.

Must contribute to EU budget → less money for domestic spending.

A disadvantage is that the UK must contribute money to the EU budget (1), which reduces the amount available for domestic spending (1).

What is a transfer payment?

Government payments with no goods/services exchanged (e.g., pensions).

Give two examples of transfer payments.

State pension; child benefit. Jobseeker’s Allowance

Why might a multinational locate in the UK?

Skilled workforce; good infrastructure. Stable inflation

A multinational may locate in the UK because it has a highly skilled and educated workforce (ID), which means firms can produce high‑quality goods with fewer errors (EXP).

The UK also has good infrastructure such as roads, ports and broadband (ID), which reduces transport and communication costs for the firm (EXP)

Why are US multinationals successful?

Strong branding; large global presence.

US multinationals are successful because they are very large companies such as Microsoft and Apple (ID), which allows them to benefit from economies of scale and lower average costs (EXP).

They also have strong global branding and advertising (ID), which makes their products instantly recognisable and attractive to consumers worldwide (EXP).

What is the Eurozone?

EU countries that use the euro (e.g., Germany, France).

The Eurozone is the group of EU countries that use the euro as their currency (1). Examples include Germany, France and Spain (1).