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AQA AS Level Economics Homework Help watch

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    I have been assigned some economics homework and the first section I can complete and understand but the last section confuses me and I just don't understand how I am supposed to know. This is the section, I haven't studied economics before so its all new to me and I understood the first section but this part just confused me :s

    Task 2- Read and complete questionsLondon bike scheme firm profit upSerco, which has been awarded the contract to operate London's new bike hire scheme, said profits havesurged as it won a record number of contracts.Pre-tax profit rose 33% to £83.4m in the first six months from the same period last year.The company signed contracts valued at £2.1bn and was named the preferred bidder for £1.4bn worth of contracts.Serco is benefiting as cash-strapped governments increase outsourcing of key services to private companies.Increased demand"The financial crisis and subsequent economic slowdown means that governments around the world are contendingwith increasing demand for high quality services whilst also facing a sharp deterioration in public finances," Sercosaid.The company recently won a Transport for London contract to design and operate the new network of 6,000 bicyclesfor hire and 400 docking stations in central London.The London Cycle Hire Scheme will be similar to Paris's popular Velib bike hire scheme. The six-year contract is valued at about £140m, Serco said.The company also operates the Docklands Light Railway in London's Canary Wharf and prisons in the UK andAustralia, as well as support services for the NHS and the US government."In home affairs, both in the UK and Australia, we continue to see strong opportunities driven by rising prisonpopulations and border security issues," Serco said."Given the economic climate our customers face, they are increasingly asking for our support in existing markets,and we also see significant opportunities to extend our capabilities to new markets," it added.QuestionsHow did Serco spot a gap in the market?What other businesses may benefit during the recession? ( explain your reasoning)Discuss whether you think Serco will perform under conditions of economic growth
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