3.4- market structures- a level economics edexcel exam
What % market share does a firm need to exceed to be considered a monopoly? -
ANS25%
What % market share does a firm need to reach to be considered a PURE
monopoly? - ANS100%
Private sector allocates resources by... - ANSEntrepeneur
Individuals
Firms
Private sector aim - ANSProfit incentive
Public sector allocates resources by... - ANSGovernment
Public sector aim - ANSSocial welfare
3 benefits of private sector - ANSDynamic Efficiency
No government failure
More choice/variety for consumers
3 costs of private sector - ANSNot always allocatively efficient
Inequality
Under-provision of merit goods
Less social welfare
Productive efficiency is... - ANSproducing a good or service at the lowest possible
cost
Productively efficient market structure - ANSSR: None
LR: Perfect competition
Allocative efficiency is... - ANSmaximising consumer welfare with production
Allocatively efficient market structure - ANSPerfect Competition
Dynamic efficiency is... - ANSwhen supernormal profit is reinvested into R&D and
innovation
Dynamically efficient market structure - ANSOligopoly
Monopoly
X-inefficiency (organisational slack) is... - ANSNot producing at the lowest possible
cost
Anti-trust agencies monitor behaviour which can... - ANS'distort, restrict or prevent
competition'
What % market share does a firm need to exceed to be considered a monopoly? -
ANS25%
What % market share does a firm need to reach to be considered a PURE
monopoly? - ANS100%
Private sector allocates resources by... - ANSEntrepeneur
Individuals
Firms
Private sector aim - ANSProfit incentive
Public sector allocates resources by... - ANSGovernment
Public sector aim - ANSSocial welfare
3 benefits of private sector - ANSDynamic Efficiency
No government failure
More choice/variety for consumers
3 costs of private sector - ANSNot always allocatively efficient
Inequality
Under-provision of merit goods
Less social welfare
Productive efficiency is... - ANSproducing a good or service at the lowest possible
cost
Productively efficient market structure - ANSSR: None
LR: Perfect competition
Allocative efficiency is... - ANSmaximising consumer welfare with production
Allocatively efficient market structure - ANSPerfect Competition
Dynamic efficiency is... - ANSwhen supernormal profit is reinvested into R&D and
innovation
Dynamically efficient market structure - ANSOligopoly
Monopoly
X-inefficiency (organisational slack) is... - ANSNot producing at the lowest possible
cost
Anti-trust agencies monitor behaviour which can... - ANS'distort, restrict or prevent
competition'
