(a)[8]
Explain the function of profit in an economy in which the price mechanism is used to allocate resources.
(b)[12]
Discuss whether resources are allocated more effectively in a planned economy or in a market economy.
Economics 9708 · AS & A Level · Resource allocation in different economic systems
Resource allocation in different economic systems — practice question
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Knowledge and understanding of profit as the reward to the factor enterprise for organising the factors of production and taking the risk of production” …
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