Band 7 Example
Question: Why are things more expensive in some places than in others?
Idea 1
Cost of Living
Model Answer
Things are more expensive in some places because the cost of living is higher there. For example, in big cities like New York or London, everything from rent to wages is much higher than in smaller towns. This means that businesses have to charge more for their products and services to cover these costs.
Idea 2
Supply and Demand
Model Answer
Prices can also vary based on supply and demand. In tourist hotspots, for instance, there's a high demand for local products and services, which drives prices up. Similarly, during peak seasons like Christmas or summer holidays, prices tend to increase due to the higher demand.
Idea 3
Economic Factors
Model Answer
Economic factors like taxes and import duties also affect prices. Some places have higher tax rates, which can make goods and services more expensive. Stronger economies with higher purchasing power tend to have higher prices as well. Government policies can also influence prices, for example, by subsidizing certain industries or products.
Idea 4
Transportation Costs
Model Answer
Transportation costs also affect how much things cost in different places. Remote or hard-to-reach areas like islands or mountainous regions often face higher transportation costs, which makes goods more expensive there. For example, transporting goods to Alaska is more costly, which is reflected in the prices of products.