Whilst Cineworld has struggled, online media entertainment providers such as Netflix, Disney+ and Amazon Prime have seen a significant increase in revenues and profits. An industry insider said, 'People who are forced to stay at home are spoilt for choice when they pick up their remote control". The sales of complementary goods such as TVs and sound systems have benefited from the growth of online media. [Paragraph 5] Text C - Problems for the airline industry Table 1 Year US airline passenger numbers (millions) 2018 4543 2019 4723 2020 1807 2021 2277 The table shows the impact of the Covid19 pandemic on the airline industry in the US. Domestic and global air travel has been one of the hardest hit industries since the pandemic began in early 2020. Whilst this decline in air travel has come at a significant cost to airline industry revenues, profits and employment it has reduced some of the negative externalities associated with air travel. Just ask people who live near airports. Less air travel has also reduced carbon emissions. [Paragraph 6] Answer the following questions a. (i) Define the term resources. (Text A, paragraph 1) [2] (ii) Using a production possibility curve (PPC) diagram, explain the effect on the allocation of resources of factors of production moving from the office space market to the IT market. (Text A, paragraph 1) [4] b. Using a demand and supply diagram, explain how the efficiency gains amongst financial services firms might affect the market price and quantity in the financial services market. (Text 1, paragraph 3) (4] c. (i) Define the term producer surplus. (Text C, paragraph 4) [2] (ii) Using a demand supply diagram explain the impact the fall in demand for cinemas during the pandemic has had on the producer surplus of firms in the cinema market such as Cineworld. (Text C, paragraph 4) [4] d. (i) State the relationship between the cinemas and online streaming services such as Netflix. (Text C, paragraph 5) [1] (ii) List two complements of online streaming services such as Netflix. (Text C, paragraph 4) [2]Microeconomic consequences of the pandemic Text A - Zoom continues to grow and grow Zoom's CEO and founder Eric Yuan sees continued growth for both his own video communication product and for the video communication market in general. Resources have flowed into the video communications as well as other IT markets over the last 12 months. The Covid19 pandemic has forced huge numbers of businesses and organisations into online working and Zoom along with Microsoft Teams and Skype have been significant beneficiaries. Yuan expects Zoom's sales to rise by 40% this year to reach nearly $3.5 billion. [Paragraph 1] One of the most significant consequences of the growth in online working is the decline in the demand for office space in major cities around the world. [Paragraph 2] The growth in homeworking using software apps such as Zoom has also led to up-skilling amongst workers in the labour market. People have had to learn how to use new software and enhance their skills on existing software. One IT industry insider said, "industries from financial services to law will see efficiency gains from the technological advance caused by the pandemic.' In the public sector, technological improvements have helped the healthcare sector in areas such as organising the vaccination programme to combat the pandemic. [Paragraph 3] Text B - Cineworld closures Cineworld is set to close a large number of its cinemas in the US and in the UK in the coming months. The pandemic has hit the cinema industry particularly hard. Lockdowns, social - distancing and a pause in the release of major films have made trading conditions extremely challenging for the cinema industry and led to a fall in the producer surplus of firms in the market. [Paragraph 4]e. (1) Define the term negative externality. (Text C, paragraph 6) (2] (ill) Using and cost and benefit diagram, explain a negative production externality associated with air travel. (Text C, paragraph 6) (4] f. Using information from the text and your knowledge of economics, evaluate the view that improvements in technology because of the pandemic have increased economic welfare in society. [15] Total [40]