Three points to be covered:
Explanation could include:
Definition must include the following:
the (next) best alternative foregone/not taken as a result of taking a decision/making a choice.
Because it is a 3 marks question – appropriate example of choice must be given.
Factors of production:
Examples for each factor must be given to fetch full marks.
Build a two sided discussion and consider the pros and cons of using natural resources. You answer could include:
if Conservation of natural resources is done:
On the other hand use of natural resources:
A one-sided answer, which focuses on the conservation or use of resources only, can gain no more than 5 marks.
Explanation should include the definition of LAND and examples
It refers to all those natural resources used in production.
Examples could include: Coal, oil, gold, fish, forests and the land itself
The answer must include the following concept explanation
The answer must include the following:
Definition of opportunity cost: the (next) best alternative foregone as a result of making a decision
Diagram of production possibility curve – axes correctly labelled and curve correct shape (bowed out or straight downward sloping)
Explanation – idea of moving along one axis has the effect of a reverse movement along the other axis
This is a 4 marks questions. Therefore, the answer should go beyond just the definition and should include atleast two comparisons.
This answer should inclulde :
a PPC (production possibility curve) diagram (properly labeled) showing a shift of PPC to the left. An explanation of the diagram and its movement will fetch full marks.
The explanation should state that fewer resources reduces the ability of an economy to produce both products/reduces productive potential/reduces GDP which results in the shift of PPC to the level
You are expected to:
Define an oligopoly and characteristics of an oligopoly market structure
Distinction between a collusive and non-collusive oligopoly
Explanation of prices may not change due to interdependence among firms.
Support your explanation with the help of an kinked demand curve
Explain the diagram
Explain that there might be non-price competition in this kind of market structure such as advertising.
However, despite their relative stability, prices may change in a non-collusive oligopoly:
– price change operated by market leaders
– long-run changes leading to economies of scale and lower LRACs.