ai) The main factors of production are:

• Land: Natural resources.
• Labor: Human effort.
• Capital: Man-made tools.
• Entrepreneurship: Risk-taking and organization.

aii) Four fixed capital items are:

• Buildings (e.g., bank branches).
• Machinery (e.g., ATMs in Ghanaian banks).
• Vehicles (e.g., armored cars for cash transport).
• Furniture (e.g., office desks).

b) The U-shaped marginal cost (MC) curve indicates that MC initially decreases due to economies of scale and specialization, reaches a minimum at optimal output, then rises due to diseconomies like overcrowding or resource strain. In Ghanaian banking, this reflects how expanding branches reduces per-unit costs initially but increases them beyond capacity, as regulated by BoG’s operational risk standards under Basel II/III.

c) The main distinct market structures are:

• Perfect competition: Many buyers/sellers, homogeneous products.
• Monopolistic competition: Many firms, differentiated products.
• Oligopoly: Few firms, interdependent.
• Monopoly: Single firm, no close substitutes.

d) Two features of free competition (perfect competition) are:

• Large number of buyers and sellers, preventing price control by any one, similar to Ghana’s forex market under BoG oversight.
• Free entry and exit, allowing firms to enter profitable markets, as seen in fintech entries post-Act 987.

e) Two factors determining the total cost of any firm are:

• Fixed costs: Invariable with output, like rent for bank premises.
• Variable costs: Change with output, such as staff salaries tied to transaction volumes in Ghanaian banks.