Economics (AS & A Level) · Oct / Nov 2022 · Paper 33 · Question 8

The manufacture of some sports equipment is dominated by very large firms but there are also smaller firms in the industry. What enables a small firm to exist in such an industry?

1. Ahigh concentration ratio that reduces competition
2. Bhigh start-up costs that occur in a contestable market
3. Cdecreasing average cost as a large firm expands
4. Da requirement for personalised equipment

As printed in the paper