Question 2 · 20 marks · Government microeconomic intervention - market failure and government correction of market failure
Market failure exists in all economies. Evaluate, with the aid of a diagram(s), the meaning of market failure and two policies a government may use to correct market failure. [20]
Question 3 · 20 marks · The price system and the microeconomy - market structures (perfect competition and monopoly), short-run and long-run equilibrium and profit
Evaluate, with the aid of a diagram(s), whether excess profit (supernormal profit) is always necessary for the continued existence of firms in perfect competition and monopoly.…
Question 4 · 20 marks · The macroeconomy - inflation, and fiscal and monetary policy to control inflation
In 2022, many countries experienced a high rate of inflation caused by disruptions to the supply of goods and services arising from the Covid-19 pandemic and the conflict between…