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Using a diagram, explain why firms in monopolistic competition are neither allocatively nor productively efficient?

Assumptions: large no. of firms in the industry, relatively small firms, low barriers to entry, perfect knowledge, product differentiation Allocative efficiency: MC=AR and the market allocated resources so t...
SL
Answered by Sukirti L. • Economics tutor
9078 Views

How many diagrams do I have to draw in an answer, and how do I use them in my answer?

Diagrams in IB Economics are a very important indicator to the examiner to quickly check if you know what you're doing. You can sound as smart as you want - mess up the diagrams, or don't use them, and you'r...
LB
Answered by Lucas B. • Economics tutor
3657 Views

I do not understand how demand and supply work, can you please explain it to me?

Economics is the social science that studies the production, distribution and the consumption of goods and services. To explain this concept, we use the model of demand and supply, which is shown in a graph....
AM
Answered by Anya M. • Economics tutor
2537 Views

What are the effects of price controls such as a maximum price (price ceiling)

Price controls by the government distort the market as supply is not able or willing to meet demand at the given imposed price. The market may not clear excess demand or excess supply as the price is fixed b...
JF
24298 Views

Evaluate the view that economic growth is best achieved through improvements in technology

Economic growth refers to an increase in real GDP (or output) and can be achieved in a number of ways not only including an improvement in technology but also attempts at improving the human capital of an ec...
HN
Answered by Hari N. • Economics tutor
10849 Views