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A-LevelEconomicsThe price system and the microeconomy9708/33 · Oct/Nov 2019 · Q121 Mark

What would explain an increase in the size of an industry and a fall in the average output of the firms in an industry? A an advance in communication methods which reduce coordination problems within firms B an advance in technology which increases the cost advantage of capital-intensive methods of production C an increase in barriers to entry into the industry combined with an increase in barriers to exit from the industry D an increase in external economies of scale combined with a decrease in internal economies of scale

  1. (a)What would explain an increase in the size of an industry and a fall in the average output of the firms in an industry? A an advance in communication methods which reduce coordination problems within firms B an advance in technology which increases the cost advantage of capital-intensive methods of production C an increase in barriers to entry into the industry combined with an increase in barriers to exit from the industry D an increase in external economies of scale combined with a decrease in internal economies of scale[1]

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2019). The mark or mark type is shown in brackets.

  1. [1] (Correct option is D)

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About this question

Topic
The price system and the microeconomy, A-Level Economics (syllabus 9708). Structured question, 1 mark.
Source
A-Level Economics, Oct/Nov 2019 Paper 3 Variant 3, question 12.

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