“Economic systems are the means by which countries and governments organize, allocate
and distribute goods, services and resources.”
In terms of the above statement, compare and contrast the different economic systems.
Include in your answer examples of contemporary economic systems.
QUESTION TWO [20]
For each of the following independent events, explain with the aid of a diagram, the effect on
the equilibrium price and quantity of MP3 players (such as the iPod) if:
2.1 The price of a personal computer falls (10)
2.2 The price of an MP3 download rises (10)
QUESTION THREE [30]
3.1 Provide the elasticity coefficients for the following categories of price elasticity of
demand. Include in your answer, using diagrams to motivate your answer, an
explanation of its implication for total revenue for a business.
3.1.1 Elastic demand (10)
3.1.2 Inelastic demand (10)
3.1.3 Unit elastic demand