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<title>DP Economics: Unit 2.11(2) Market power - Perfect competition(HL)</title>
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style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35118/unit-2111-market-power-theory-of-production-and-costs-hl.html" title="Unit 2.11(1) Market power - Theory of production and costs (HL)">Unit 2.11(1) Market power - Theory of production and costs (HL)</a></li><li class="current" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="unit-2112-market-power-perfect-competitionhl.html" title="Unit 2.11(2) Market power - Perfect competition(HL)">Unit 2.11(2) Market power - Perfect competition(HL)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35147/unit-2113-market-power-monopolyhl.html" title="Unit 2.11(3) Market power - Monopoly(HL)">Unit 2.11(3) Market power - Monopoly(HL)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35151/unit-2114-market-power-monopolistic-competitionhl.html" title="Unit 2.11(4) Market power - Monopolistic competition(HL)">Unit 2.11(4) Market power - Monopolistic competition(HL)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35153/unit-2115-market-power-oligopolyhl.html" title="Unit 2.11(5) Market power - Oligopoly(HL)">Unit 2.11(5) Market power - Oligopoly(HL)</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../41603/economics-real-world-examples-and-extension-material-.html" title="Economics real world examples and extension material ">Economics real world examples and extension material </a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../43378/opportunity-cost-and-production-possibility-curves.html" title="Opportunity cost and production possibility curves">Opportunity cost and production possibility curves</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42559/demand-theory.html" title="Demand theory">Demand theory</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../41886/the-price-mechanism.html" title="The price mechanism">The price mechanism</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../43188/market-demand-and-supply.html" title="Market demand and supply">Market demand and supply</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../41705/demerit-goods.html" title="Demerit goods">Demerit goods</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42275/market-failure-and-climate-change.html" title="Market failure and climate change">Market failure and climate change</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42925/market-power.html" title="Market power">Market power</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42099/applying-game-theory.html" title="Applying game theory">Applying game theory</a></li></ul></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../34407/chapter-3-macroeconomics.html" title="Chapter 3: Macroeconomics">Chapter 3: Macroeconomics</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34355/unit-311-measuring-the-level-of-economic-activity.html" title="Unit 3.1(1): Measuring the level of economic activity">Unit 3.1(1): Measuring the level of economic activity</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34432/unit-312-measuring-economic-development.html" title="Unit 3.1(2): Measuring Economic Development">Unit 3.1(2): Measuring Economic Development</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34485/unit-321-variations-in-economic-activity-aggregate-demand-ad-.html" title="Unit 3.2(1): Variations in economic activity - aggregate demand (AD) ">Unit 3.2(1): Variations in economic activity - aggregate demand (AD) </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34487/unit-322-variations-in-economic-activity-aggregate-supplyas.html" title="Unit 3.2(2): Variations in economic activity - aggregate supply(AS)">Unit 3.2(2): Variations in economic activity - aggregate supply(AS)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34758/unit-331-macroeconomic-objectives-economic-growth.html" title="Unit 3.3(1) Macroeconomic objectives: economic growth">Unit 3.3(1) Macroeconomic objectives: economic growth</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34771/unit-332-macroeconomic-objectives-unemployment-.html" title="Unit 3.3(2) Macroeconomic objectives: unemployment ">Unit 3.3(2) Macroeconomic objectives: unemployment </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34778/unit-333-macroeconomic-objectives-inflation-and-deflation--1.html" title="Unit 3.3(3) Macroeconomic objectives: inflation and deflation ">Unit 3.3(3) Macroeconomic objectives: inflation and deflation </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34925/unit-341-economics-of-inequality-and-poverty-1.html" title="Unit 3.4(1) Economics of inequality and poverty">Unit 3.4(1) Economics of inequality and poverty</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34946/unit-342-policies-to-improve-equality-equity-and-poverty.html" title="Unit 3.4(2) Policies to improve equality, equity and poverty">Unit 3.4(2) Policies to improve equality, equity and poverty</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34993/unit-35-government-management-of-the-economy-monetary-policy-1.html" title="Unit 3.5 Government management of the economy – monetary policy">Unit 3.5 Government management of the economy – monetary policy</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../34962/unit-36-government-management-of-the-economy-fiscal-policy-1.html" title="Unit 3.6 Government management of the economy – fiscal policy">Unit 3.6 Government management of the economy – fiscal policy</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35017/unit-371-market-based-supply-side-policies--1.html" title="Unit 3.7(1) Market based supply-side policies ">Unit 3.7(1) Market based supply-side policies </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35018/unit-372-interventionist-supply-side-policies-.html" title="Unit 3.7(2) Interventionist supply-side policies ">Unit 3.7(2) Interventionist supply-side policies </a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../45803/economics-real-world-examples-and-extension-material--1.html" title="Economics real world examples and extension material ">Economics real world examples and extension material </a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42639/measuring-economic-well-being-1.html" title="Measuring economic well-being">Measuring economic well-being</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../43044/inflation.html" title="Inflation">Inflation</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../42350/inequality.html" title="Inequality">Inequality</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../41639/inequity-1.html" title="Inequity">Inequity</a></li></ul></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../35414/chapter-4-the-global-economy.html" title="Chapter 4: The Global Economy">Chapter 4: The Global Economy</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35346/unit-41-benefits-of-international-trade-1.html" title="Unit 4.1 Benefits of international trade">Unit 4.1 Benefits of international trade</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35348/unit-4243-trade-protectionism-1.html" title="Unit 4.2/4.3 Trade protectionism">Unit 4.2/4.3 Trade protectionism</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35407/unit-44-economic-integration-.html" title="Unit 4.4 Economic integration ">Unit 4.4 Economic integration </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35409/unit-45-exchange-rates-1.html" title="Unit 4.5 Exchange rates">Unit 4.5 Exchange rates</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35413/unit-46-balance-of-payments--1.html" title="Unit 4.6 Balance of payments ">Unit 4.6 Balance of payments </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35675/unit-47-sustainable-development.html" title="Unit 4.7 Sustainable development">Unit 4.7 Sustainable development</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35685/unit-48-measuring-development--1.html" title="Unit 4.8 Measuring development ">Unit 4.8 Measuring development </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35687/unit-49-barriers-to-economic-development-1.html" title="Unit 4.9 Barriers to economic development">Unit 4.9 Barriers to economic development</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../35702/unit-410-economic-growth-and-economic-development-strategies.html" title="Unit 4.10: Economic growth and economic development strategies">Unit 4.10: Economic growth and economic development strategies</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../45804/economics-real-world-examples-and-extension-material-.html" title="Economics real world examples and extension material ">Economics real world examples and extension material </a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../41927/foreign-currency-1.html" title="Foreign currency">Foreign currency</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../43532/exchange-rates-1.html" title="Exchange rates">Exchange rates</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../43804/balance-of-payments.html" title="Balance of payments">Balance of payments</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../41796/economic-development-1.html" title="Economic development">Economic development</a></li></ul></ul></ul><li class=" parent std-toplevel" style="padding-left: 4px"><i class="expander fa fa-caret-right "></i><a class="" href="../20132/units-1-2-microeconomics.html" title="Units 1-2: Microeconomics">Units 1-2: Microeconomics</a></li><ul class="level-1 "><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Unit 1: Introduction to economics">Unit 1: Introduction to economics</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20091/introductory-activity-1.html" title="Introductory activity">Introductory activity</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20093/unit-11-scarcity-choice-and-opportunity-cost.html" title="Unit 1.1: Scarcity, choice and opportunity cost">Unit 1.1: Scarcity, choice and opportunity cost</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21647/factors-of-production-1.html" title="Factors of production">Factors of production</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20114/economic-systems.html" title="Economic systems">Economic systems</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20134/public-and-private-sectors-1.html" title="Public and private sectors">Public and private sectors</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../28055/unit-12-economics-as-a-social-science-1.html" title="Unit 1.2: Economics as a social science">Unit 1.2: Economics as a social science</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29921/circular-flow-of-national-income.html" title="Circular flow of national income">Circular flow of national income</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29829/unit-1-review-terms-1.html" title="Unit 1: Review terms">Unit 1: Review terms</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../41600/introduction-to-economics-crossword-1.html" title="Introduction to economics crossword">Introduction to economics crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../4331/unit-1-multiple-choice-quiz.html" title="Unit 1: Multiple choice quiz">Unit 1: Multiple choice quiz</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20177/unit-21-23-competitive-markets-demand-and-supply-1.html" title="Unit 2.1-2.3: Competitive markets - demand and supply">Unit 2.1-2.3: Competitive markets - demand and supply</a></li><ul class="level-2 "><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../28517/unit-21-demand-1.html" title="Unit 2.1: Demand">Unit 2.1: Demand</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../22349/determinants-of-demand-1.html" title="Determinants of demand">Determinants of demand</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29949/unit-22-supply-.html" title="Unit 2.2: Supply ">Unit 2.2: Supply </a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20184/changes-to-supply-and-demand-.html" title="Changes to supply and demand ">Changes to supply and demand </a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21992/practise-exercises-1.html" title="Practise exercises">Practise exercises</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../26112/gold-exchange-game-demand-and-supply-1.html" title="Gold exchange game: Demand and supply">Gold exchange game: Demand and supply</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20194/unit-23-competitive-market-equilibrium-1.html" title="Unit 2.3: Competitive market equilibrium">Unit 2.3: Competitive market equilibrium</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20144/producer-and-consumer-surplus-1.html" title="Producer and consumer surplus">Producer and consumer surplus</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../22351/veblen-goods-and-super-luxury-goods-1.html" title="Veblen goods and super luxury goods">Veblen goods and super luxury goods</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../25677/are-cryptocurrencies-the-new-tulipmania.html" title="Are Cryptocurrencies the new Tulipmania?">Are Cryptocurrencies the new Tulipmania?</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20472/unit-21-23-multiple-choice-quiz.html" title="Unit 2.1-2.3: Multiple choice quiz">Unit 2.1-2.3: Multiple choice quiz</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20113/unit-24-consumer-and-producer-behaviour-hl-only-1.html" title="Unit 2.4: Consumer and producer behaviour (HL only)">Unit 2.4: Consumer and producer behaviour (HL only)</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../36073/behavioural-economics-consumer-biases-nudge-theory-hl-only-1.html" title="Behavioural economics: Consumer biases / nudge theory (HL only)">Behavioural economics: Consumer biases / nudge theory (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20378/business-objectives-hl-only.html" title="Business objectives (HL only)">Business objectives (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../28741/unit-21-24-review-terms--1.html" title="Unit 2.1-2.4: Review terms ">Unit 2.1-2.4: Review terms </a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20195/unit-25-26-elasticity-1.html" title="Unit 2.5-2.6: Elasticity">Unit 2.5-2.6: Elasticity</a></li><ul class="level-2 "><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../28713/unit-25-price-elasticity-of-demand-1.html" title="Unit 2.5: Price elasticity of demand">Unit 2.5: Price elasticity of demand</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21545/determinants-of-price-elasticity-.html" title="Determinants of price elasticity ">Determinants of price elasticity </a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21532/ped-elasticity-and-sales-revenue.html" title="PED elasticity and sales revenue?">PED elasticity and sales revenue?</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21259/unit-25-income-elasticity-of-demand-yed.html" title="Unit 2.5: Income elasticity of demand (YED)">Unit 2.5: Income elasticity of demand (YED)</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21200/unit-26-price-elasticity-of-supply.html" title="Unit 2.6: Price elasticity of supply">Unit 2.6: Price elasticity of supply</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20207/perfectly-elastic-inelastic-supply-curves.html" title="Perfectly elastic / inelastic supply curves">Perfectly elastic / inelastic supply curves</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20230/a-mathematical-note-about-elasticity-.html" title="A mathematical note about elasticity ">A mathematical note about elasticity </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../39037/demand-and-supply-crossword.html" title="Demand and supply crossword">Demand and supply crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29021/unit-25-26-review-terms-1.html" title="Unit 2.5-2.6: Review terms">Unit 2.5-2.6: Review terms</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20474/unit-25-26-multiple-choice-quiz--1.html" title="Unit 2.5-2.6: Multiple choice quiz ">Unit 2.5-2.6: Multiple choice quiz </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../44474/unit-21-25-competitive-markets-quiz-1.html" title="Unit 2.1- 2.5: Competitive markets quiz">Unit 2.1- 2.5: Competitive markets quiz</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20243/unit-27-the-role-of-government-in-microeconomics--1.html" title="Unit 2.7: The role of government in microeconomics ">Unit 2.7: The role of government in microeconomics </a></li><ul class="level-2 "><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../26590/indirect-taxation.html" title="Indirect taxation">Indirect taxation</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20246/ped-and-the-burden-of-tax-hl-only-.html" title="PED and the burden of tax (HL only) ">PED and the burden of tax (HL only) </a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20277/government-subsidies--1.html" title="Government subsidies ">Government subsidies </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29117/unit-27-indirect-tax-and-subsidy-review-terms-1.html" title="Unit 2.7: Indirect tax and subsidy review terms">Unit 2.7: Indirect tax and subsidy review terms</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20287/price-controls-maximum-price--1.html" title="Price controls − maximum price ">Price controls − maximum price </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20288/minimum-price-.html" title="Minimum price ">Minimum price </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21540/minimum-wage-.html" title="Minimum wage ">Minimum wage </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../38849/labour-market-crossword-1.html" title="Labour market crossword">Labour market crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29260/unit-27-price-controls-review-terms-1.html" title="Unit 2.7: Price controls review terms">Unit 2.7: Price controls review terms</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20303/unit-28-210-market-failure--1.html" title="Unit 2.8-2.10: Market failure ">Unit 2.8-2.10: Market failure </a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21543/unit-28-merit-goods--1.html" title="Unit 2.8: Merit goods ">Unit 2.8: Merit goods </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../23123/unit-28-demerit-goods-negative-externalities-1.html" title="Unit 2.8: Demerit goods / negative externalities">Unit 2.8: Demerit goods / negative externalities</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../38850/market-failure-crossword-1.html" title="Market failure crossword">Market failure crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29262/unit-29-economics-of-the-environment-and-public-goods--1.html" title="Unit 2.9: Economics of the environment and public goods ">Unit 2.9: Economics of the environment and public goods </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20332/unit-210-asymmetric-information-hl-only-1.html" title="Unit 2.10: Asymmetric information (HL only)">Unit 2.10: Asymmetric information (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29828/unit-28-210-market-failure-review-sheet.html" title="Unit 2.8-2.10: Market failure review sheet">Unit 2.8-2.10: Market failure review sheet</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29827/unit-28-210-market-failure-review-terms.html" title="Unit 2.8-2.10: Market failure review terms">Unit 2.8-2.10: Market failure review terms</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20479/unit-27-210-multiple-choice-quiz--1.html" title="Unit 2.7-2.10: Multiple choice quiz ">Unit 2.7-2.10: Multiple choice quiz </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../44501/unit-27-210-government-failure-revision-quiz-1.html" title="Unit 2.7-2.10 Government failure revision quiz">Unit 2.7-2.10 Government failure revision quiz</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20330/unit-211-market-power-hl-only-1.html" title="Unit 2.11: Market power (HL only)">Unit 2.11: Market power (HL only)</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29835/assessment-map.html" title="Assessment map">Assessment map</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21528/production-hl-only.html" title="Production (HL only)">Production (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29978/revenue-theory-hl-only.html" title="Revenue theory (HL only)">Revenue theory (HL only)</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20357/costs-of-production-hl-only.html" title="Costs of production (HL only)">Costs of production (HL only)</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21286/economies-and-diseconomies-of-scale-hl-only.html" title="Economies and diseconomies of scale (HL only)">Economies and diseconomies of scale (HL only)</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../22494/long-run-average-cost-curves-hl-only.html" title="Long run average cost curves (HL only)">Long run average cost curves (HL only)</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../29838/breakeven-hl-only.html" title="Breakeven (HL only)">Breakeven (HL only)</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20340/economic-profit-hl-only.html" title="Economic profit (HL only)">Economic profit (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../39082/market-power-crossword.html" title="Market power crossword">Market power crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../22495/revision-exercise-on-cost-and-revenue-hl-only.html" title="Revision exercise on cost and revenue (HL only)">Revision exercise on cost and revenue (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29845/unit-211-costs-revenue-and-profit-review-sheet-hl-only.html" title="Unit 2.11: Costs, revenue and profit review sheet (HL only)">Unit 2.11: Costs, revenue and profit review sheet (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../44484/unit-211-multiple-choice-quiz-sl-units-1.html" title="Unit 2.11: Multiple choice quiz (SL units)">Unit 2.11: Multiple choice quiz (SL units)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29846/market-structures-hl-only-1.html" title="Market structures (HL only)">Market structures (HL only)</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29981/perfect-competition-hl-only-1.html" title="Perfect competition (HL only)">Perfect competition (HL only)</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../24486/profit-in-perfect-competition-hl-only-1.html" title="Profit in perfect competition (HL only)">Profit in perfect competition (HL only)</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21302/efficiency-in-perfect-competition-hl-only.html" title="Efficiency in perfect competition (HL only)">Efficiency in perfect competition (HL only)</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20430/monopoly-hl-only-1.html" title="Monopoly (HL only)">Monopoly (HL only)</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../24529/profit-and-revenue-maximisation-in-monopoly-hl-only-1.html" title="Profit and revenue maximisation in monopoly (HL only)">Profit and revenue maximisation in monopoly (HL only)</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21306/a-comparison-of-monopoly-and-perfect-competition-hl-only-1.html" title="A comparison of monopoly and perfect competition? (HL only)">A comparison of monopoly and perfect competition? (HL only)</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20435/monopolistic-competition-hl-only-1.html" title="Monopolistic competition (HL only)">Monopolistic competition (HL only)</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20436/oligopoly-hl-only-1.html" title="Oligopoly (HL only)">Oligopoly (HL only)</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../22310/game-theory-hl-only-1.html" title="Game theory (HL only)">Game theory (HL only)</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29918/unit-211-market-structures-review-sheet-hl-only-1.html" title="Unit 2.11: Market structures review sheet (HL only)">Unit 2.11: Market structures review sheet (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../32337/unit-211-diagram-revision-.html" title="Unit 2.11: Diagram revision ">Unit 2.11: Diagram revision </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20480/unit-211-multiple-choice-quiz-hl-only-1.html" title="Unit 2.11: Multiple choice quiz (HL only)">Unit 2.11: Multiple choice quiz (HL only)</a></li></ul><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../32425/unit-212-the-markets-inability-to-achieve-equity-hl-only-1.html" title="Unit 2.12: The market’s inability to achieve equity (HL only)">Unit 2.12: The market’s inability to achieve equity (HL only)</a></li></ul><li class=" parent std-toplevel" style="padding-left: 4px"><i class="expander fa fa-caret-right "></i><a class="" href="../21842/unit-3-macroeconomics-.html" title="Unit 3: Macroeconomics ">Unit 3: Macroeconomics </a></li><ul class="level-1 "><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../3942/unit-31-measuring-economic-activity-and-illustrating-its-variati-1.html" title="Unit 3.1: Measuring economic activity and illustrating its variations">Unit 3.1: Measuring economic activity and illustrating its variations</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20558/calculating-national-income-1.html" title="Calculating national income">Calculating national income</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21297/gdp-gni-as-a-measure-of-living-standards.html" title="GDP / GNI as a measure of living standards">GDP / GNI as a measure of living standards</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20567/national-income-statistics-1.html" title="National income statistics">National income statistics</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21580/the-business-cycle-1.html" title="The business cycle">The business cycle</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29931/unit-31-economic-activity-review-sheet-1.html" title="Unit 3.1: Economic activity review sheet">Unit 3.1: Economic activity review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20592/unit-32-variations-in-economic-activityaggregate-demand-and-aggr-1.html" title="Unit 3.2: Variations in economic activity—aggregate demand and aggregate supply">Unit 3.2: Variations in economic activity—aggregate demand and aggregate supply</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../29933/aggregate-demand-and-supply.html" title="Aggregate demand and supply">Aggregate demand and supply</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21582/components-of-aggregate-demand-1.html" title="Components of aggregate demand">Components of aggregate demand</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20634/equilibrium-in-macroeconomics-neo-classical-perspective-1.html" title="Equilibrium in macroeconomics (neo-classical perspective)">Equilibrium in macroeconomics (neo-classical perspective)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20439/equilibrium-in-macroeconomics-keynesian-perspective-1.html" title="Equilibrium in macroeconomics (keynesian perspective)">Equilibrium in macroeconomics (keynesian perspective)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21349/john-maynard-keynes-1.html" title="John Maynard Keynes">John Maynard Keynes</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20650/keynesian-v-free-market-debate--1.html" title="Keynesian v free market debate ">Keynesian v free market debate </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21342/changes-in-the-long-run-aggregate-supply-1.html" title="Changes in the long run aggregate supply">Changes in the long run aggregate supply</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30055/unit-32-aggregate-demand-and-supply-review-sheet-1.html" title="Unit 3.2: Aggregate demand and supply review sheet">Unit 3.2: Aggregate demand and supply review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20610/unit-35-and-36-demand-management-fiscal-and-monetary-policy-1.html" title="Unit 3.5 and 3.6: Demand management - fiscal and monetary policy">Unit 3.5 and 3.6: Demand management - fiscal and monetary policy</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30058/government-budget.html" title="Government budget">Government budget</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21585/fiscal-policy--1.html" title="Fiscal policy ">Fiscal policy </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21343/multiplier-hl-only.html" title="Multiplier (HL only)">Multiplier (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21795/monetary-policy--1.html" title="Monetary policy ">Monetary policy </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30071/independent-central-banks-1.html" title="Independent central banks">Independent central banks</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30083/unit-35-and-36-review-sheet.html" title="Unit 3.5 and 3.6 review sheet">Unit 3.5 and 3.6 review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20615/unit-37-supply-side-policies-1.html" title="Unit 3.7: Supply side policies">Unit 3.7: Supply side policies</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20651/the-role-of-supply-side-policies-1.html" title="The role of supply side policies">The role of supply side policies</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20622/market-based-and-interventionist-supply-side-policies--1.html" title="Market based and interventionist supply side policies ">Market based and interventionist supply side policies </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../39129/aggregate-demand-and-supply-crossword-1.html" title="Aggregate demand and supply crossword">Aggregate demand and supply crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30086/unit-37-review-sheet-1.html" title="Unit 3.7: Review sheet">Unit 3.7: Review sheet</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20755/unit-31-32-and-35-37-multiple-choice-quiz--1.html" title="Unit 3.1-3.2 and 3.5-3.7: Multiple choice quiz ">Unit 3.1-3.2 and 3.5-3.7: Multiple choice quiz </a></li></ul><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../44522/unit-31-32-and-35-37-revision-quiz-1.html" title="Unit 3.1-3.2 and 3.5-3.7: Revision quiz">Unit 3.1-3.2 and 3.5-3.7: Revision quiz</a></li><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20686/unit-33-macroeconomic-objectives.html" title="Unit 3.3: Macroeconomic objectives">Unit 3.3: Macroeconomic objectives</a></li><ul class="level-2 "><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30118/unemployment.html" title="Unemployment">Unemployment</a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21351/types-of-unemployment.html" title="Types of unemployment?">Types of unemployment?</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21593/equilibrium-unemployment-.html" title="Equilibrium unemployment ">Equilibrium unemployment </a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../21594/disequilibrium-unemployment-1.html" title="Disequilibrium unemployment">Disequilibrium unemployment</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../30458/unemployment-review-sheet-1.html" title="Unemployment review sheet">Unemployment review sheet</a></li></ul><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20713/inflation--1.html" title="Inflation ">Inflation </a></li><ul class="level-3 "><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20712/measuring-inflation-hl-only-1.html" title="Measuring inflation (HL only)">Measuring inflation (HL only)</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../20685/costs-of-inflation-and-deflation-1.html" title="Costs of inflation and deflation">Costs of inflation and deflation</a></li><li class="" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="" href="../30465/inflation-review-sheet.html" title="Inflation review sheet">Inflation review sheet</a></li></ul><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20716/unemployment-v-inflation-trade-off-hl-only-1.html" title="Unemployment v inflation trade off (HL only)">Unemployment v inflation trade off (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../39133/macroeconomic-objectives-crossword-1.html" title="Macroeconomic objectives crossword">Macroeconomic objectives crossword</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../44511/unit-33-macroeconomic-indicators-revision-quiz-1.html" title="Unit 3.3: Macroeconomic indicators revision quiz">Unit 3.3: Macroeconomic indicators revision quiz</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20741/unit-34-economics-of-inequality-and-poverty-1.html" title="Unit 3.4: Economics of inequality and poverty">Unit 3.4: Economics of inequality and poverty</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../32398/inequality-1.html" title="Inequality">Inequality</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21356/the-role-of-spending-and-taxation-on-inequality--1.html" title="The role of spending and taxation on inequality ">The role of spending and taxation on inequality </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21313/consequences-of-economic-growth-1.html" title="Consequences of economic growth">Consequences of economic growth</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30257/economic-growth-and-inequality-review-sheet-1.html" title="Economic growth and inequality review sheet">Economic growth and inequality review sheet</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20756/unit-33-34-multiple-choice-.html" title="Unit 3.3-3.4: Multiple choice ">Unit 3.3-3.4: Multiple choice </a></li></ul></ul><li class=" parent std-toplevel" style="padding-left: 4px"><i class="expander fa fa-caret-right "></i><a class="" href="../21844/unit-4-global-economy.html" title="Unit 4: Global economy">Unit 4: Global economy</a></li><ul class="level-1 "><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../21367/unit-41-benefits-of-international-trade.html" title="Unit 4.1: Benefits of international trade">Unit 4.1: Benefits of international trade</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30529/benefits-of-international-trade.html" title="Benefits of international trade">Benefits of international trade</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20823/absolute-and-comparative-advantage-hl-only-1.html" title="Absolute and comparative advantage (HL only)">Absolute and comparative advantage (HL only)</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20845/unit-42-43-trade-protection-1.html" title="Unit 4.2-4.3: Trade protection">Unit 4.2-4.3: Trade protection</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../32419/barriers-to-trade-calculations-are-hl-only-1.html" title="Barriers to trade (calculations are HL only)">Barriers to trade (calculations are HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21610/case-study-on-tata-steel-1.html" title="Case study on Tata Steel">Case study on Tata Steel</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../23455/the-defence-industry-1.html" title="The Defence industry">The Defence industry</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30610/unit-41-43-review-sheet-1.html" title="Unit 4.1-4.3: Review sheet">Unit 4.1-4.3: Review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20894/unit-44-economic-integration--1.html" title="Unit 4.4: Economic integration ">Unit 4.4: Economic integration </a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30634/economic-integration-some-hl-tasks-1.html" title="Economic integration (some HL tasks)">Economic integration (some HL tasks)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20840/world-trade-organisation-wto-1.html" title="World trade organisation (WTO)">World trade organisation (WTO)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30635/unit-44-review-sheet-1.html" title="Unit 4.4: Review sheet">Unit 4.4: Review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20853/unit-45-exchange-rates-1.html" title="Unit 4.5: Exchange rates">Unit 4.5: Exchange rates</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30611/floating-exchange-rates-1.html" title="Floating exchange rates">Floating exchange rates</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../31824/fixed-managed-exchange-rate-systems-some-hl-tasks-1.html" title="Fixed / managed exchange rate systems (some HL tasks)">Fixed / managed exchange rate systems (some HL tasks)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21624/the-market-for-foreign-exchange-1.html" title="The market for foreign exchange">The market for foreign exchange</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30614/unit-45-review-sheet-1.html" title="Unit 4.5: Review sheet">Unit 4.5: Review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20859/unit-46-balance-of-payments-1.html" title="Unit 4.6: Balance of payments">Unit 4.6: Balance of payments</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30624/balance-of-payments--1.html" title="Balance of payments ">Balance of payments </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21386/current-account-hl-only-1.html" title="Current account (HL only)">Current account (HL only)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20872/the-marshall-lerner-condition-j-curve-hl-only-1.html" title="The Marshall-Lerner condition / J curve (HL only)">The Marshall-Lerner condition / J curve (HL only)</a></li></ul><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20899/units-41-46-multiple-choice-quiz--1.html" title="Units 4.1-4.6: Multiple choice quiz ">Units 4.1-4.6: Multiple choice quiz </a></li><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../42989/unit-41-46-multiple-choice-quiz-ii-1.html" title="Unit 4.1-4.6: Multiple choice quiz II">Unit 4.1-4.6: Multiple choice quiz II</a></li><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../39438/unit-41-46-international-trade-crossword-1.html" title="Unit 4.1-4.6: International trade crossword">Unit 4.1-4.6: International trade crossword</a></li><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../32423/unit-47-sustainable-development--1.html" title="Unit 4.7: Sustainable development ">Unit 4.7: Sustainable development </a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../26092/water-scarcity-activity-1.html" title="Water scarcity activity">Water scarcity activity</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../32426/sustainable-development.html" title="Sustainable development">Sustainable development</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../20928/unit-48-measuring-development--1.html" title="Unit 4.8: Measuring development ">Unit 4.8: Measuring development </a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30686/measuring-development-1.html" title="Measuring development">Measuring development</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21627/economic-development--1.html" title="Economic development ">Economic development </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30679/unit-47-48-review-sheet.html" title="Unit 4.7-4.8: Review sheet">Unit 4.7-4.8: Review sheet</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Unit 4.9: Barriers to development">Unit 4.9: Barriers to development</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30727/barriers-to-development-in-international-trade-1.html" title="Barriers to development in International trade">Barriers to development in International trade</a></li></ul><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../32430/unit-410-economic-growth-andor-economic-development-strategies-1.html" title="Unit 4.10: Economic growth and/or economic development strategies">Unit 4.10: Economic growth and/or economic development strategies</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30687/the-role-of-domestic-factors-1.html" title="The role of domestic factors">The role of domestic factors</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30688/the-role-of-international-trade-and-development-1.html" title="The role of international trade and development">The role of international trade and development</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30689/the-role-of-foreign-direct-investment-fdi-1.html" title="The role of foreign direct investment (FDI)">The role of foreign direct investment (FDI)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../25240/the-role-of-foreign-aid--1.html" title="The role of foreign aid ">The role of foreign aid </a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30819/multilateral-development-assistance-1.html" title="Multilateral development assistance">Multilateral development assistance</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21632/the-role-of-international-debt-1.html" title="The role of international debt">The role of international debt</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../25242/the-balance-between-markets-and-intervention-1.html" title="The balance between markets and intervention">The balance between markets and intervention</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../30926/unit-49-410-review-sheet.html" title="Unit 4.9 - 4.10: Review sheet">Unit 4.9 - 4.10: Review sheet</a></li></ul></ul><li class=" parent std-toplevel" style="padding-left: 4px"><i class="expander fa fa-caret-right "></i><a class="" href="../21380/assessment.html" title="Assessment">Assessment</a></li><ul class="level-1 "><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Internal assessment ">Internal assessment </a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../20608/how-to-write-your-ia-student-handout.html" title="How to write your IA? (student handout)">How to write your IA? (student handout)</a></li><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../21428/how-to-interpret-the-assessment-criteria-1.html" title="How to interpret the assessment criteria?">How to interpret the assessment criteria?</a></li><li class=" parent" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Grading practise ">Grading practise </a></li><ul class="level-3 "><li class=" parent" style="padding-left: 42px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Sample 3a">Sample 3a</a></li><ul class="level-4 "><li class="" style="padding-left: 56px"><i class="expander fa fa-caret-right "></i><a class="" href="../32083/sample-3b-1.html" title="Sample 3b">Sample 3b</a></li></ul></ul></ul><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../32022/assessment-markbands-1.html" title="Assessment markbands">Assessment markbands</a></li></ul><li class=" parent std-toplevel" style="padding-left: 4px"><i class="expander fa fa-caret-right "></i><a class="" href="../4332/exam-style-questions.html" title="Exam style questions">Exam style questions</a></li><ul class="level-1 "><li class=" parent" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="std-disabled" href="#" title="Paper 1 style examination questions">Paper 1 style examination questions</a></li><ul class="level-2 "><li class="" style="padding-left: 28px"><i class="expander fa fa-caret-right "></i><a class="" href="../40100/unit-211-212-questions.html" title="Unit 2.11-2.12 questions">Unit 2.11-2.12 questions</a></li></ul><li class="" style="padding-left: 14px"><i class="expander fa fa-caret-right "></i><a class="" href="../45102/paper-1-guidance-on-essay-writing-1.html" title="Paper 1 guidance on essay writing">Paper 1 guidance on essay writing</a></li></ul></ul></nav> </div> </div> </div> </div><div style="margin-top: 20px;"><style type="text/css">
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<div id="main-column" class="span9"> <article id="unit-2112-market-power-perfect-competitionhl" style="margin-top: 16px;">
<h1 class="section-title">Unit 2.11(2) Market power - Perfect competition(HL)</h1>
<ul class="breadcrumb"><li><a title="Home" href="../../../economics.html"><i class="fa fa-home"></i></a><span class="divider">/</span></li><li><span class="gray">Textbook</span><span class="divider">/</span></li><li><span class="gray">Chapter 2: Microeconomics</span><span class="divider">/</span></li><li><span class="active">Unit 2.11(2) Market power - Perfect competition(HL)</span></li></ul>
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<div class="intro-card"><div class="bg-cover" style="background-image: url("/media/ib/economics/images/textbook/market-power/orange-growers.jpg");"></div><img src="../../../ib/economics/images/textbook/market-power/orange-growers.jpg" style="display: none"><div class="content"><p class="text">Perfect competition is a theoretical model of how a market behaves under the conditions of the purest form of competition. There are no examples of pure perfect competition but the characteristics of perfect competition can be observed in agricultural markets where the industry is made up of large numbers of small producers.</p></div></div><div class="panel panel-has-footer" style="box-shadow: rgba(17, 34, 51, 0.3) 0px 10px 30px -15px; border-color: rgb(39, 45, 105);"><div class="panel-heading" style="background-color: rgb(39, 45, 105);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><h3><strong>What you should know by the end of this chapter:</strong></h3></div></div><img alt="" height="229" src="../../../ib/economics/images/textbook/market-power/rungis-12.jpg" style="float: right;" width="344"></div><ul><li>Assumptions of perfect competition</li><li>Determining price and output in perfect competition</li><li>Total, average and marginal revenue</li><li>Profit maximisation</li><li>Explanation and diagrams of normal profits, abnormal profits and losses</li><li>Efficiency in perfect competition</li><li>Evaluation of perfect competition<hr class="hidden"></li></ul><div class="greyBg"><h3>Revision material</h3><p><img alt="" src="../../../ib/economics/images/textbook/revision-material/logo.jpg" style="width: 200px; height: 95px; float: left;">The link to the attached pdf is revision material from <strong>Unit 2.11(2) Market power - Perfect competition(HL). </strong>The revision material can be downloaded as a student handout.</p><p><a href="../../../media/ib/economics/images/textbook/market-power/perfect-competition/perfect-competition-revision-notes.pdf.html" target="_blank" title="Revision"><img class="ico" src="../../../thinkib/icons/revision.png"> Revision notes</a></p></div><div class="blueBg"><h3><strong>Nature of perfect competition</strong></h3><p>Perfect competition is a theoretical model of how a market behaves under the conditions of the purest form of competition. There are no examples of pure perfect competition but the characteristics of perfect competition can be observed in agricultural markets where the industry is made up of large numbers of small producers. For example, the market for oranges in Australia can be used as an example of a market that has conditions that are similar to perfect competition, and this is the example we will use to illustrate perfect competition in this chapter.</p><h3><strong>Assumptions of perfect competition</strong></h3><h4><strong>Large number of small buyers and sellers</strong></h4><p>There are a large number of small buyers and sellers in a perfectly competitive market and no one buyer or seller can influence market price or output. For example, 1,900 commercial farms in Australia grow and produce oranges. Because each individual firm only makes up a small fraction of the market output they cannot affect the market price and output. We also assume that there are a large number of buyers so they cannot influence the market price and output either.</p><h4><strong>Homogenous products</strong></h4><p>Firms in the market sell a homogenous product which means there are no differences between the goods and services supplied by different firms. In theory, the orange farmers all sell the same quality and type of orange and they all offer the same quality of service to their customers. This means the buying decisions of consumers of oranges are made purely on price and not on any other factor such as the quality of the product.</p><h4><strong>Perfect knowledge</strong></h4><p>There is perfect knowledge on the part of buyers and sellers so that all agents in the market know about the prices being charged by all the producers in the market. This means no firm can charge a different price in the market without consumers or other firms in the market knowing about the different prices being charged. </p><h4><strong>No barriers to entry or exit</strong></h4><p>There are no barriers to entry or exit present in the market. This means the costs of setting up in the market are not higher than the normal costs of setting up in a market and there are no additional costs associated with leaving the market. This means, for example, that orange growers can acquire the land, capital and labour needed to set up and produce oranges without incurring any extra costs or restrictions associated with entering the market. Firms in the market will only incur the normal costs of leaving the market when they shut down production.</p><h4><strong>Implications of the assumptions</strong></h4><p>The assumption of perfect competition is important in determining how perfectly competitive markets behave because they affect the decisions made by consumers and producers in the market. The assumptions are particularly important in determining the demand and supply conditions in the market and how the market price is determined.</p><h3><strong>Price and output in perfect competition</strong></h3><h4><strong>Market price</strong></h4><p>In perfect competition, demand and supply determine the market price and output. Diagram 2.59 shows how the market demand and supply for oranges determine the price and output in the market. The demand curve in the market is based on the law of demand and is the sum of the demand curves of all the individual buyers in the market. The supply curve is based on the law of supply and is derived from the sum of all the marginal cost curves of the individual firms in the market.</p><h4><strong>The demand curve facing the firm</strong></h4><p>The market price is the price each firm in the perfect market has to charge or take. If the firm tries to charge more than the market price then the quantity demanded will fall to zero because consumers can buy exactly the same product from an alternative supplier at the market price. There is no incentive for firms to charge less than the market price because they can sell all they want at the market price. The assumptions of the model mean that firms are price takers and face a perfectly elastic demand curve. This is shown in diagram 2.59.</p><h4><img alt="" src="../../../ib/economics/images/textbook/market-power/demand-curve-in-perfect-competition.jpg" style="float: left; width: 591px; height: 300px;"></h4><hr class="hidden"></div><div class="pinkBg"><div class="panel panel-has-footer" style="box-shadow: rgba(17, 34, 51, 0.3) 0px 10px 30px -15px; border-color: rgb(39, 45, 105);"><div class="panel-heading" style="background-color: rgb(39, 45, 105);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><h4><strong>Inquiry case example - Oranges in Australia</strong></h4></div></div></div><p><img alt="" height="263" src="../../../ib/economics/images/textbook/market-power/orange-growers.jpg" style="float: left;" width="339">In Australia, orange growing is a significant part of the agricultural industry in South Australia, Victoria, New South Wales and Queensland. There are over 28,000 hectares of oranges trees in these states and around 1,900 growers. Many of the oranges grown in Australia are sold in the Sydney Produce Market, which is the largest fresh fruit and vegetable wholesale market in Australia and one of the largest in the world. Australian oranges are sold in the domestic market and also exported.</p><hr class="hidden"><p>Oranges are healthy food and are bought by households as part of their regular grocery shopping. But a high proportion of oranges sold are also bought by businesses who use them to manufacture fruit juice and other processed food products.</p><p><a href="../../../media/ib/economics/images/textbook/market-power/perfect-competition/pc-orange-market.pdf.html" target="_blank" title="Questions"><img class="ico" src="../../../thinkib/icons/question.png"> Worksheet questions</a></p><h5>Questions</h5><p><strong>a. Using the assumption of perfect competition, explain why the orange market in Australia can be used as an example of perfect competition. [4]</strong></p><section class="tib-hiddenbox"><p>The orange market can be used as an example of perfect competition because:</p><ul><li>There are many small producers in the market</li><li>Oranges are close to being a homogenous product</li><li>Levels of knowledge amongst consumers and producers are high</li><li>There are low barriers to entry to the orange market for new entrants.</li></ul></section><p><strong>b. Using a diagram, explain the implications of the assumptions of perfect competition for orange producers. [4]</strong></p><section class="tib-hiddenbox"><p>The assumptions of perfect competition (many buyers and sellers, perfect knowledge, homogenous product and no barriers to entry or exit) mean firms have to charge the market equilibrium price for the oranges they sell. This means the firms in the orange market face a perfectly elastic demand curve for the goods they sell and this is shown in the diagram. </p><p><img alt="" height="267" src="../../../ib/economics/images/textbook/inquiry-case-example-questions/perfectly-elastic-demand.jpg" width="518"></p></section><hr class="hidden"><h5><strong>Investigation</strong></h5><p><strong>Research the orange market in another country. Find out how many growers there are and the industry's importance to the economy of the country you have chosen. </strong></p></div><div class="blueBg"><hr class="hidden"><h4><strong>Revenue</strong></h4><p>Revenue is the income a firm receives from selling its good or service. There are three ways of expressing the revenue a business receives:</p><h5><strong>Total revenue</strong></h5><p>Total revenue (TR) is the total income a business receives and is calculated as:</p><ul><li>price x quantity = total revenue</li><li>P x Q = TR</li></ul><h5><strong>Average revenue</strong></h5><p>Average revenue (AR) is the revenue per unit of output sold by a firm and is calculated as:</p><ul><li>total revenue / output = average revenue</li><li>TR / Q = AR</li><li>AR = P</li></ul><h5><strong>Marginal revenue</strong></h5><p>Marginal revenue is the change in total revenue when one more unit of output is sold and is calculated as:</p><ul><li>change in total revenue / change in output = marginal revenue</li><li>∆TR / ∆Q = MR</li></ul><p>With the perfectly elastic demand curve, the firm faces in perfect competition the price the firm receives is equal to average revenue and marginal revenue. The demand curve the firm faces can be expressed as:</p><p>D = AR = MR</p><p>In the orange market example, each farm has to charge $2.00 per kilo which equals the average revenue and marginal revenue for each firm in the market. </p><h4><strong>Output</strong></h4><p>Classical economic theory assumes firms in the industry aim to profit maximise which means they produce where marginal cost equals marginal revenue when marginal cost is rising. In diagram 2.60 the firm produces 40,000 kgs of oranges per month to profit maximise. Adding together the total output of each producer in the market gives a total market output of 50 million kgs per month.</p><p><img alt="" height="291" src="../../../ib/economics/images/textbook/market-power/profit-max-in-perfect-comp.jpg" style="float: left;" width="580"></p><hr class="hidden"><h4><strong>Equilibrium</strong></h4><h5><strong>Short-run equilibrium</strong></h5><p>The industry will be in short-run equilibrium when demand equals supply. This means an equilibrium price and output in the industry, but this equilibrium situation can change if abnormal profits or losses are being made by firms in the market.</p><h5><strong>Long-run equilibrium</strong></h5><p>Similar to short-run equilibrium this is the output where market demand equals supply, but firms in the market are all making normal profit. Because there are no abnormal profits or losses in the market means there are no pressures on market price and output to change.</p><h3><strong>Profits and Losses</strong></h3><h4><strong>Normal Profit</strong></h4><p>Normal profit is the minimum profit firms need to earn to remain in a particular market. It represents the resource cost of enterprise as a factor of production. Entrepreneurs who enter the orange market will need a certain level of profit to reward them for the risk of setting up production in the market. This means normal profit is included as part of the firm's total cost of production.</p><p>Normal profit is achieved when total cost is equal to total revenue or average total cost equals average revenue:</p><p>ATC = AR</p><p>Diagram 2.61 shows firms in the perfect market for oranges where each producer is earning normal profit.</p><h4><img alt="" height="300" src="../../../ib/economics/images/textbook/market-power/normal-profit-perfect-competition.jpg" style="float: left;" width="583"></h4><hr class="hidden"><hr class="hidden"><h4><strong>Abnormal profits</strong></h4><p>Abnormal profit is earned by a firm when the entrepreneur earns more than the minimum profit required to keep the firm in the industry. This means total revenue is greater than total cost:</p><p>(AR > ATC) x Q.</p><p>In the orange market example, an increase in demand for oranges from D to D1 causes the market price to rise from $2.00 to $2.50 and this means individual firms in the industry are receiving a higher price which results in AR rising above ATC leading to abnormal profits.</p><hr class="hidden"><p>In diagram 2.62 this can be calculated as:</p><p>$2.50 - $2.20 = $0.30 per unit</p><p>$0.30 x 44,000 = $13,200 total abnormal profit.</p><p>New firms see this as an opportunity to make abnormal profits and enter the orange market. This leads to an increase in market supply which causes the market price to fall reducing the abnormal profit of the existing producers until firms stop entering the market and profits return to normal.</p><hr class="hidden"><p><img alt="" src="../../../ib/economics/images/textbook/market-power/perfect-competition-abnormal-profit1.jpg" style="width: 600px; height: 307px;"></p><hr class="hidden"><hr class="hidden"><h4><strong>Losses</strong></h4><p>Losses occur when total cost is greater than total revenue which can be expressed as:</p><p>(ATC > AR) X Q.</p><p>This means firms are making less than normal profit so entrepreneurs will start to leave the industry because they are not making enough profit to keep them in the market. Diagram 2.63 shows how a fall in market demand from D to D1 for oranges leads to losses as the market price falls from $2.00 to $1.60 and average revenue falls below average total cost.</p><h4><img alt="" src="../../../ib/economics/images/textbook/market-power/perfect-competition/pc-losses.jpg" style="width: 600px; height: 303px;"></h4><hr class="hidden"><p>In diagram 2.63 this can be calculated as:</p><p>$2.05 - $1.60 = -$0.45 per unit</p><p>-$0.45 x 35,000 = -$15,750</p><p>As firms leave the industry market supply falls, price rises and the profit for the remaining firms in the industry will return to normal.</p></div><div class="pinkBg"><div class="panel panel-has-footer" style="box-shadow: rgba(17, 34, 51, 0.3) 0px 10px 30px -15px; border-color: rgb(39, 45, 105);"><div class="panel-heading" style="background-color: rgb(39, 45, 105);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><h4><strong>Inquiry case example - The booming olive market</strong></h4></div></div></div><p><img alt="" src="../../../ib/economics/images/textbook/market-power/olive-oil.jpg" style="float: left; width: 346px; height: 299px;" title="https://oldwayspt.org/blog/extra-virgin-olive-oil-core-mediterranean-diet">More and more consumers in countries across the world are consuming increasing amounts of olive oil. It is seen as a healthier option than other vegetable oils and butter. The growing number of people adopting plant-based diets has also accounted for the trend. This is ‘boom time’ for olive growers who are benefiting from higher prices, revenues and profits.</p><hr class="hidden"><p>The global market for olives is forecasted to grow at 4.5% per annum over the next five years. The market is seeing an increasing number of farmers switching production from other crops to produce olives to take advantage of rising profits.</p><p><a href="../../../media/ib/economics/images/textbook/market-power/perfect-competition/olive-oil-market.pdf.html" target="_blank" title="Revision"><img class="ico" src="../../../thinkib/icons/revision.png"> Worksheet questions</a></p><h4><strong>Questions</strong></h4><p><strong>a. Explain why firms such as olive growers would be described as price takers in a perfectly competitive market. [4]</strong></p><section class="tib-hiddenbox"><p>In a perfectly competitive market, the equilibrium price is determined by demand and supply and this is the price olive growers have to charge (take). If a firm charged a price above the market equilibrium price quantity demanded would fall to zero because the market has a large number of competitors, homogenous products and perfect knowledge.</p></section><p><strong>The table sets out cost, price and revenue data for a firm in the olive market. </strong></p><table border="1" cellpadding="0" cellspacing="0"><tbody><tr><td style="width:128px;"><p align="center"><strong>Output (units)</strong></p></td><td style="width:128px;"><p align="center"><strong>Price</strong></p></td><td style="width:128px;"><p align="center"><strong>Total revenue</strong></p></td><td style="width:128px;"><p align="center"><strong>Total cost</strong></p></td><td style="width:128px;"><p align="center"><strong>Marginal cost</strong></p></td></tr><tr><td style="width:128px;"><p align="center">10,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"></td><td style="width:128px;"><p align="center">$55,000</p></td><td style="width:128px;"><p align="center"></p></td></tr><tr><td style="width:128px;"><p align="center">15,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center"></p></td><td style="width:128px;"><p align="center">$70,000</p></td><td style="width:128px;"><p align="center"></p></td></tr><tr><td style="width:128px;"><p align="center">20,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center"></p></td><td style="width:128px;"><p align="center">$95,000</p></td><td style="width:128px;"><p align="center"></p></td></tr><tr><td style="width:128px;"><p align="center">25,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center"></p></td><td style="width:128px;"><p align="center">$140,000</p></td><td style="width:128px;"><p align="center"></p></td></tr></tbody></table><p><strong>b. Using the data in the table calculate the following:</strong></p><p><strong>(i) Total revenue at each level of output. [2]</strong></p><p><strong>(ii) The marginal cost at output levels 15,000, 20,000 and 25,000. [2]</strong></p><p><strong>(iii) The profit maximising output. [2]</strong></p><p><strong>(iv) The profit at the profit maximising output. [2]</strong></p><section class="tib-hiddenbox"><table border="1" cellpadding="0" cellspacing="0"><tbody><tr><td style="width:128px;"><p align="center"><strong>Output (units)</strong></p></td><td style="width:128px;"><p align="center"><strong>Price</strong></p></td><td style="width:128px;"><p align="center"><strong>Total revenue</strong></p></td><td style="width:128px;"><p align="center"><strong>Total cost</strong></p></td><td style="width:128px;"><p align="center"><strong>Marginal cost</strong></p></td></tr><tr><td style="width:128px;"><p align="center">10,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center">$50,000</p></td><td style="width:128px;"><p align="center">$55,000</p></td><td style="width:128px;"><p align="center"></p></td></tr><tr><td style="width:128px;"><p align="center">15,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center">$75,000</p></td><td style="width:128px;"><p align="center">$70,000</p></td><td style="width:128px;"><p align="center">$3</p></td></tr><tr><td style="width:128px;"><p align="center">20,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center">$100,000</p></td><td style="width:128px;"><p align="center">$95,000</p></td><td style="width:128px;"><p align="center">$5</p></td></tr><tr><td style="width:128px;"><p align="center">25,000</p></td><td style="width:128px;"><p align="center">$5.00</p></td><td style="width:128px;"><p align="center">$125,000</p></td><td style="width:128px;"><p align="center">$140,000</p></td><td style="width:128px;"><p align="center">$9</p></td></tr></tbody></table><p>Profit maximising output (MC = MR) 20,000 units</p><p>Total profit: $100,000 - $95,000 = $5,000 </p></section><p><strong>(v) State the type of profit the firm is making at the profit maximising output. [1]</strong></p><section class="tib-hiddenbox"><p>Abnormal profit</p></section><p><strong>c. Using a market diagram for olive oil, explain what would happen to the market as a result of the type of profit earned by firms in the industry. [4]</strong></p><section class="tib-hiddenbox"><p>Abnormal profit in the olive market will attract new producers into the industry. Because there are no barriers to entry in perfect competition there will be free movement of new entrants into the market. The diagram shows how this will cause the market supply to increase, the equilibrium price to fall and the industry output to increase.</p></section><h5><strong>Investigation</strong></h5><p><strong>Research the olive market in a country to see whether it is behaving in the way the theory of perfect competition would predict.</strong></p></div><div class="blueBg"><h3><strong>Efficiency in perfect competition</strong></h3><h4><strong>Productive (technical) efficiency</strong></h4><p>Productive efficiency is achieved when all firms in the industry are producing where they achieve the highest output per unit of resource input. This means each firm in the market is producing at the profit maximising output at the minimum point of average total cost:</p><p>MC = minimum ATC </p><p>This is achieved in perfect competition when firms are making normal profits, but not abnormal profit or losses. This is shown in diagram 2.64 at output of 40,000 kgs.</p><p><img alt="" height="302" src="../../../ib/economics/images/textbook/market-power/effciency-in-perfect-competition.jpg" style="float: left;" width="588"></p><hr class="hidden"><p>Economists believe that the pressure of intense competition which exists in perfect competition forces firms to be productively efficient. If a firm cannot achieve the minimum average total costs of its competitors it will make losses and be forced out of the market. Productive efficiency is achieved when the firm is making normal profit, but it will not be achieved when the firm is making abnormal profit (output is above the productively efficient level) and losses (output is below the productively efficient level). This is shown in diagrams 2.62 and 2.63.</p><h4><strong>Allocative efficiency</strong></h4><p>Allocative efficiency is achieved when resources are allocated in a market to maximise the social/community surplus. This occurs when market demand equals market supply. We assume there are no positive or negative externalities in the market. Allocative efficiency is shown in diagram 2.64. This is achieved in all profit-making situations in perfect competition. This occurs because no single firm can affect the market price and all firms are forced to charge the market price. If one firm tried to charge a price above marginal cost the demand for their product would fall to zero.</p><h4><strong>Evaluation of perfect competition</strong></h4><p>Perfectly competitive markets will lead to productive and allocative efficiency in the long run. This means all resources are being used efficiently and the market will maximise the welfare of consumers and producers. However, the model has some weaknesses:</p><ul><li>No markets fully achieve the strict conditions of perfect competition. There will always be some differences in the goods sold by different producers and some barriers to entry are likely to exist in every market for some producers.</li><li>Only a small number of industries in an economy come close to being perfectly competitive. Many markets in the economy exist with conditions that are completely different to perfect competition. For example, markets are often dominated by large businesses that account for a high proportion of total market output. It is difficult to believe perfect competition would be the most efficient market structure in the car industry.</li><li>Perfect competition might achieve the allocative and productive efficient output in the long run, but the goods and services sold in the market offer no real choice to consumers because of the assumption of homogenous products. For example, imagine a perfect market for shoes where all the shoes in the market are exactly the same.</li><li>The model makes no allowance for positive or negative externalities which will affect welfare in society.</li></ul></div><div class="pinkBg"><div class="panel panel-has-footer" style="box-shadow: rgba(17, 34, 51, 0.3) 0px 10px 30px -15px; border-color: rgb(39, 45, 105);"><div class="panel-heading" style="background-color: rgb(39, 45, 105);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><h4><strong>Inquiry case example - The opium market in Afghanistan</strong></h4></div></div></div><p>There was a 43%<img alt="" height="253" src="../../../ib/economics/images/textbook/market-power/opium.jpg" style="float: left;" width="307"> increase in Opium production in Afghanistan last year. Increasing global demand, combined with good farming conditions has led to a significant increase in the output of Afghanistan’s poppy growers. The UN Office on Drugs and Crime (UNODC) said there was a 10% increase in the land given over to opium production. ‘The market is certainly expanding’ said one UN official.</p><hr class="hidden"><p>Afghanistan is the world's largest producer of opium, which is the main ingredient in heroin. The crop is illegal in Afghanistan but it controlling production is very difficult. It is a very profitable crop for poorer farmers and it is supported by the Taliban who tax it to fund their military activities. </p><p><a href="../../../media/ib/economics/images/textbook/market-power/perfect-competition/opium-market.pdf.html" target="_blank" title="Questions"><img class="ico" src="../../../thinkib/icons/question.png"> Worksheet questions</a></p><h5><strong>Questions</strong></h5><p><strong>a. Explain the impact an increase in demand would have on the market price and output of opium in the short run and long run assuming the market is perfectly competitive. [10]</strong></p><section class="tib-hiddenbox"><p>Answers might include:</p><ul><li>Definitions perfect competition, short-run and long-run</li><li>A diagram to show the impact of an increase in demand for opium. This is shown in the diagram below where an increase in the demand for opium in Afghanistan leads to abnormal profit. </li></ul><p><img alt="" src="../../../ib/economics/images/textbook/inquiry-case-example-questions/opium-perfect-competition.jpg" style="width: 500px; height: 258px;"></p><ul><li>An explanation that an increase in demand for opium leads to abnormal profits in the opium market in the short run which is shown by the yellow shaded area in the diagram.</li><li>An explanation that in the long run, the abnormal profit in the opium industry would attract new entrants into the opium market which would lead to an increase in market supply and result in a fall in the market price. The fall in price would cause profits in the market to fall back to normal in the long run and firms would stop entering the market.</li></ul></section><p><strong>b. Using a real-world example, evaluate the view that perfect competition always leads to an efficient allocation of resources. [15]</strong></p><section class="tib-hiddenbox"><p>Answers might include: </p><ul><li>Definitions of productive efficiency, allocative efficiency and allocation of resources. *Possible to refer to the definition of perfect competition in part a.</li><li>A diagram to show efficiency in perfect competition. </li></ul><p><img alt="" height="255" src="../../../ib/economics/images/textbook/inquiry-case-example-questions/efficiency-perfect-competition.jpg" width="540"></p><ul><li>An explanation that perfect competition always achieves allocative efficiency in theory because the market price and output are set by demand and supply which maximises the consumer and producer surplus (community or social surplus). This is shown in the market part of the diagram.</li><li>An explanation that productive efficiency is achieved in perfect competition when all the firms in the industry are making a normal profit and they are producing where MC equals ATC. This means ATC is minimised and output in the industry is maximised per unit of resource input. </li><li>A real-world example could include a discussion of efficiency in the opium market.</li><li>Evaluation might include discussion of situations when perfect competition does not 'always' lead to productive efficiency if firms are making abnormal profits or losses. There could also be some discussion of the limitations of the assumptions of perfect competition and how this might limit market efficiency in reality such as products not being homogenous or some barriers to entry existing. In the case example, the market might achieve allocative and productive efficiency but the external costs associated with opium production and consumption are likely to reduce welfare in society.</li></ul></section><h5><strong>Investigation </strong></h5><p><strong>Research the opium market further in Afghanistan and try and understand its importance to the Afghan economy.</strong></p></div><div class="panel panel-has-footer" style="box-shadow: rgba(51, 0, 0, 0.3) 0px 10px 30px -15px; border-color: rgb(124, 7, 21);"><div class="panel-heading" style="background-color: rgb(124, 7, 21);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><p>Thinking about a key concept - efficiency</p></div></div><div class="panel-body"><div><p>One of the strengths of the model of perfect competition is that it allows us to see how a market achieves productive and allocative efficiency and what this means for an economy. If every market in a country was perfectly competitive then resources would always be allocated to maximise the welfare of consumers and producers. If a significant number of these markets are in long-run equilibrium then a high level of productive efficiency will be achieved. </p><p>To what extent is this a realistic view of how the microeconomy operates in a country?</p></div></div></div><div class="panel panel-has-footer" style="box-shadow: rgba(17, 34, 51, 0.3) 0px 10px 30px -15px; border-color: rgb(39, 45, 105);"><div class="panel-heading" style="background-color: rgb(39, 45, 105);"><a class="expander pull-right" href="#"><span class="fa fa-plus"></span></a><div><h4>Now test yourself</h4></div></div></div><div class="tib-quiz" data-quiz-id="1355" data-structure="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" data-score-answers="6d4a526a457a48584f763758344a7649472f76324c53614b78524c393439595570496d5a5971374b38686f3d"><div class="exercise"><div class="q-question"><p>Which of the following is not an assumption of perfect competition?</p></div><div class="q-answer"><p><label class="radio" data-answer="8b62af2d2a9788d3a1d1a01b160c2415"><input type="radio"><span> Perfect knowledge</span></label></p><p><label class="radio" data-answer="f9cff3c27bfc74e0dfc8510a13f3d52a"><input type="radio"><span> Barriers to entry exist</span></label></p><p><label class="radio" data-answer="0971295ddce54e2f5510c22992d6673c"><input type="radio"><span> Homogenous product</span></label></p><p><label class="radio" data-answer="86bf0121bb74f1f08991c9f466140059"><input type="radio"><span> Large number of buyers and sellers</span></label></p></div><div class="q-explanation"><p>There are no barriers to entry in perfect competition.</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following is not true about the demand and revenue the firm faces in perfect competition?</p></div><div class="q-answer"><p><label class="radio" data-answer="40531bb8ce30bfef389b42512134c68b"><input type="radio"><span> Price x quantity = TR</span></label></p><p><label class="radio" data-answer="d93f9ebfbb3e6d30c6e48002106e5964"><input type="radio"><span> At the market price: D = AR = MR</span></label></p><p><label class="radio" data-answer="8bb9eaadb0ce8357d57c87d4bd2c3b81"><input type="radio"><span> By increasing price a firm can increase TR</span></label></p><p><label class="radio" data-answer="000ca78ba667aa9cdfb8b8c26694fb1a"><input type="radio"><span> The demand curve the firm faces is perfectly elastic</span></label></p></div><div class="q-explanation"><p>When a firm increases price in perfect competition Qd and TR would fall to zero.</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>At which output does the firm always achieve profit maximisation in perfect competition?</p></div><div class="q-answer"><p><label class="radio" data-answer="0fb2ba97e9e9d6f3cef70f826e11cbca"><input type="radio"><span> MC = MR when MC is falling</span></label></p><p><label class="radio" data-answer="737f4359d0cfccebaf04549e256efe4e"><input type="radio"><span> P = AR</span></label></p><p><label class="radio" data-answer="f67db4f56c1bd5f7e9c32a90762b48cc"><input type="radio"><span> MC = MR when MC is rising</span></label></p><p><label class="radio" data-answer="c4cdd5621f00dce996af3350ff4ee38c"><input type="radio"><span> ATC = AR</span></label></p></div><div class="q-explanation"><p> </p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following is not true in the diagram?</p><p><strong><img alt="" height="215" src="../../../ib/economics/images/textbook/mc-questions/perfect-competition-normal-profit.jpg" style="float: left;" width="413"></strong></p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p></div><div class="q-answer"><p><label class="radio" data-answer="0e3f55cf536f1e8dbde8bb7a73c2c635"><input type="radio"><span> The community/social surplus is not being maximised</span></label></p><p><label class="radio" data-answer="4d562d3fb62e1183ffc8cfb9bd210e92"><input type="radio"><span> All firms are producing at the profit maximising output</span></label></p><p><label class="radio" data-answer="a50fe2b1db4ef03d23dad8b52c88ba00"><input type="radio"><span>The firm is making a normal profit in the market</span></label></p><p><label class="radio" data-answer="c9eef51939f9a593f906fc1cf1e7f96b"><input type="radio"><span>The firms in the market are making enough profit to keep entrepreneurs in the industry. </span></label></p></div><div class="q-explanation"><p>At the equilibrium price, the consumer and producer surplus is maximised so the community/social surplus is maximised.</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following would be the best definition of abnormal/supernormal profit?</p></div><div class="q-answer"><p> </p><p><label class="radio" data-answer="eee64a9bf323365d0e3299b374d2688c"><input type="radio"><span> The minimum profit an entrepreneur requires to maintain their position in the market</span></label></p><p><label class="radio" data-answer="cc30423878b917a3ebfb85650e44e7e1"><input type="radio"><span> Where total cost is equal to total revenue in the long run</span></label></p><p><label class="radio" data-answer="cf192a76601b39c5c5ab9e60b1060d21"><input type="radio"><span> Where the entrepreneur earns more profit than the minimum required to maintain their position in the market</span></label></p><p><label class="radio" data-answer="8e25989e52ce49b284f796c16796037f"><input type="radio"><span> Where the entrepreneur earns less profit than the minimum required to maintain their position in the market</span></label></p></div><div class="q-explanation"><p> </p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Using the data provided, which of the following options is the abnormal profit the firm earns?</p><p>AR: <dollar>$</dollar>4</p><p>AVC: <dollar>$</dollar>2.50</p><p>AFC: <dollar>$</dollar>0.80</p><p>Output: 25,000 units</p></div><div class="q-answer"><p><label class="radio" data-answer="4efb887e8d01bd9ae832756e0e076c54"><input type="radio"><span> <dollar>$</dollar>37,500</span></label></p><p><label class="radio" data-answer="856d86686e767c97d72637c37dd9e6ae"><input type="radio"><span> <dollar>$</dollar>17,500</span></label></p><p><label class="radio" data-answer="73aac8fd5415e02990ee229633903cf0"><input type="radio"><span> <dollar>$</dollar>80,000</span></label></p><p><label class="radio" data-answer="f50f5c81ea359350bc3c5dd92a563fd1"><input type="radio"><span> <dollar>$</dollar>100,000</span></label></p><p> </p></div><div class="q-explanation"><p>(<dollar>$</dollar>4 - <dollar>$</dollar>2.50 - <dollar>$</dollar>0.80) x 25,000 = <dollar>$</dollar>17,500</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following is least likely to be true when firms are making losses in a market?</p></div><div class="q-answer"><p><label class="radio" data-answer="1df599c8001de0ea303866c9aecf9cae"><input type="radio"><span> The market supply decreases</span></label></p><p><label class="radio" data-answer="57ed39568bbc5d6d2567e1c8863765b3"><input type="radio"><span> Some firms leave the market</span></label></p><p><label class="radio" data-answer="580eb13c68632d9749526821f8a6c376"><input type="radio"><span> ATC is greater than AR</span></label></p><p><label class="radio" data-answer="cd93ef0b109b6e8e55f12f7b1ad98cb3"><input type="radio"><span> TC equals TR</span></label></p></div><div class="q-explanation"><p>When TC = TR the firm is making a normal profit.</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following is true about the information in the diagram when the firm is profit maximising?</p><p><img alt="" height="235" src="../../../ib/economics/images/textbook/mc-questions/abnormal-profit.jpg" style="float: left;" width="299"></p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p><p> </p></div><div class="q-answer"><p><label class="radio" data-answer="d41d8cd98f00b204e9800998ecf8427e"> </label></p><p><label class="radio" data-answer="13165906f0cb344e6ea3b9e3ab9213d8"><input type="radio"><span> Average variable cost is less than <dollar>$</dollar>3.00</span></label></p><p><label class="radio" data-answer="84c4b05a0d7dab9cd40aa0da7071b396"><input type="radio"><span> Abnormal profit is <dollar>$</dollar>30,000</span></label></p><p><label class="radio" data-answer="1b34688c1e282aa55f47559b4ea2e0d0"><input type="radio"><span> Total revenue is <dollar>$</dollar>260,000</span></label></p><p><label class="radio" data-answer="dd8ffa8be1eec6aab22485bd4d523eb9"><input type="radio"><span> Total cost is <dollar>$</dollar>210,000</span></label></p><p> </p></div><div class="q-explanation"><p>ATC = AVC + AFC which means AVC must be less than ATC assuming there are fixed costs of production.</p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><p> </p><div class="exercise"><div class="q-question"><p>Which of the following are not equal on a perfect competition diagram when all the firms in the industry are profit maximising and making abnormal profit?</p></div><div class="q-answer"><p><label class="radio" data-answer="ba3ccf51129f1e3ded02a1ed54832c8d"><input type="radio"><span> The marginal cost and marginal revenue curves</span></label></p><p><label class="radio" data-answer="2ce5387d8414874ef502e5210ab34275"><input type="radio"><span> The market demand and supply curves</span></label></p><p><label class="radio" data-answer="425715c73ebf4b76561bd9a336abbf44"><input type="radio"><span> The demand curve, average revenue curve, and marginal revenue curves</span></label></p><p><label class="radio" data-answer="0139db92b8a44fa3ccee0280fa15d067"><input type="radio"><span> The average cost and marginal cost curves</span></label></p></div><div class="q-explanation"><p>When a firm is making abnormal profit in perfect competition marginal cost is above average cost. </p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><div class="exercise"><div class="q-question"><p>A profit-maximising firm in perfect competition is producing 10,000 units a month and making normal profit. Which of the following statements is least likely to be true?</p></div><div class="q-answer"><p><label class="radio" data-answer="778182e0456d0d6ced9ed6f63c3339be"><input type="radio"><span> If the firm decreased its output, MC would be below MR</span></label></p><p><label class="radio" data-answer="ff96aab1060db7393c81a8e9777a0d24"><input type="radio"><span> If the firm increased its output, MC would be above MR</span></label></p><p><label class="radio" data-answer="ddf7c394fd81a48ffde41967af46fd88"><input type="radio"><span> The firms MC and MR curves are equal</span></label></p><p><label class="radio" data-answer="d8918193e5093999de0c773ed4c0a4d5"><input type="radio"><span> The firm's AR is greater than its ATC</span></label></p></div><div class="q-explanation"><p>When the firm is making normal profit ATC equals AR. </p></div><div class="actions"><span class="score" data-score="0"></span><button class="btn check"><i class="fa fa-check-square-o"></i> Check</button></div></div><div class="totals"><span class="score">Total Score: </span><button class="btn btn-success check-total"><i class="fa fa-check-square-o"></i> Check</button></div></div><hr><script>document.querySelectorAll('.tib-teacher-only').forEach(e => e.remove());</script>
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