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12 marksMarket Structure

CAPE Economics Unit 1 · 2017 · Paper 2 · Question 2(b)

Compare, with the aid of diagrams, the productive efficiency and economic profit of a perfectly competitive firm and a monopolistically competitive firm in the long run.

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Other parts of this question

  1. 2(a)(i)Outline ONE barrier to entry.[2 marks]
  2. 2(a)(ii)Using the information in Table 2, calculate the Herfindahl-Hirschman Index (HHI).[3 marks]
  3. 2(c)Discuss TWO reasons why the market for health care may fail if it was not subsidised by the government.[8 marks]

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