Table 1 shows changes in a town's market for a standard bicycle service.
| Year | Number of service providers | Average price of service | Average waiting time |
|---|---|---|---|
| 1 | 4 | £52 | 6 days |
| 3 | 9 | £44 | 3 days |
Which statement best explains the pattern shown in Table 1?
Entry increased rivalry, so providers had to compete on waiting time as well as on price to keep customers.
The lower price attracted new providers, because firms enter a market when the price there falls.
The market became more concentrated, so the largest providers could afford lower prices and shorter waits.
Each provider gained a larger market share, giving it the freedom to cut its price and its waiting time.
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.