(b) Using a well-labelled cost/revenue diagram show how this increase in demand may affect a bottled water firm's profits. (5)

Bottled water Figure 1 UK bottled water market 2008 1,970 million litres consumption f1,380 million sales revenue 2009 2,010 $1,400m 2010 2,020 E1,420m 2011 2,070 $1,500m 2012 2, 140 E1,570m 2013 2,360 E1,770m 2014 2,580 E1,960m Source: http://www.britishsoftdrinks.com/write/MediaUploads/ Publications/BSDA_Annual_Report_2015.pdf Extract 1 Growth in UK bottled water sales The consumption of bottled water has continued to grow at a time of falling demand for other types of soft drink such as fruit juices, smoothies and fizzy colas. The growth in demand for bottled water reflects successful promotions and more people trying to follow healthier lifestyles. The potential for further growth is very positive: annual bottled water consumption per head in the UK is 41 litres, which is far below the West European average of 119 litres. The recycling of bottles and cans has increased rapidly over the past decade; many containers are now produced with 25-50% recycled materials. Of the bottled water consumed in the UK around 73% is bottled in the UK, including most supermarket own brand water. 15% comes from France, including premium brands such as Badoit and Perrier. (Source: adapted from www.britishsoftdrinks.com/PDF/2013UKsoftdrinksrep ort)