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Economics IGCSEPDF 44
118 pagesrevision 46932
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6.Factor Mobility
Difficulty for factors of production
(especially Labour) to move between
uses or locations
(occupational/geographical
immobility).
5.Abuse of When a single firm dominates a market,
Monopoly Power itmay restrict output and charge higher
prices due to a lack of competition.
Under-provision/High Prices:
Goods are under-provided to
limit supply and raise profits,
reducing consumer choice and
welfare.
Harmful effects (1) on third parties (1).
Social costs - private costs (1).
Q.There is an area of rubbish, three times the size of France, floating in the Pacific Ocean
called the Great Pacific Garbage Patch. It is made up of rubbish including old fishing nets but
most is plastic waste. It is forecast that, by 2050, there will be more plastic in the Pacific Ocean
than fish. A number of islands in the Pacific Ocean specialise in fishing. Greater pollution will
increase the social cost of
the fishing industry.
(a) Identify the two types of costs that make up social cost. [2]
(b) Analyse how cleaning up pollution could benefit an economy. [6]
Mark Scheme-
(a)
Private costs (1)
External costs (1)
(b) Coherent analysis which might include:
• Will reduce external costs (1) improve health / less sickness (1) raise quality of life / standard
Inefficient Allocation: Resources
are stuck in unproductive uses
or locations, leading to under-
provision of goods/services in
high-demand areas.
PAST-PAST QUESTIONs
Q.Define external costs. [2]
Mark Scheme-