'Governments should use whatever methods they can to regulate monopolies because they are inefficient.' Consider whether monopolies are always inefficient and what methods might be used by governments to regulate them.

Mark scheme

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

1. [25] Explanation of the analysis of efficiency and an analysis of why monopoly might not achieve efficiency.
2. [25] Consideration of whether all monopolies necessarily cause inefficient production and what policy might be used by a government to deal with the inefficiency if it occurs.
3. [18-25] L4: for a good analysis of productive and allocative efficiency; a comment on the possibility of benefits of monopoly through economies of scale, and a discussion of the likelihood of achieving this allocation through government policies.
4. [14-17] L3: for a competent explanation of efficiency probably concentrating on productive efficiency and a more limited discussion of the possibility of achieving efficiency through government policies. Little mention of benefits of monopoly.
5. [10-13] L2: for a limited account without a full analysis of efficiency and with a general comment on government policies.
6. [1-9] L1: for an answer that has some basic correct facts but includes irrelevancies and errors of theory.