One ferry company serves an island. Another operator would need to buy costly vessels and terminal facilities before carrying any passengers. An economist compares this route with a similar route served by several ferry companies.
Which outcome is most likely on the island route?
Passengers are likely to buy the same number of tickets however high fares are set
Problems with delays are likely to go unresolved for longer than on the comparison route
The company is likely to face stronger pressure to cut its costs than the comparison operators
A small rise in fares is likely to lose the company most of its passengers
149 exam-style questions on AQA GCSE Economics 1.5 Competitive and concentrated markets, covering 1.5.1a The range of market structures, 1.5.1b Distinguishing between market structures, 1.5.2a Characteristics of a competitive market, 1.5.2b How producers operate in competitive markets, 1.5.2c The economic impact of competition, 1.5.3a Characteristics of a non-competitive market, 1.5.3b How producers operate in non-competitive markets, 1.5.3c Monopoly and oligopoly, 1.5.4a The labour market and wage determination, and 1.5.4b Gross and net pay. Each one has a worked solution and a mark scheme showing where the marks go.