a. Identify the market structure for clothing stores, like Zara. Justify the reasons forsuch a structure to exist. [4 marks]b. Determine with justification the demand elasticity and market power of Zara andother clothing stores that belong to the same market structure. [4 marks]c. How does Zara or other clothing stores compete or differentiate themselves from competitors? Provide any two (2) strategies. [4 marks]d. Distinguish the type of long run profit between firms, like Zara, and firms that belong to the other market structures. Provide justification for each structure. [4 marks]e. In what circumstances will Zara cease production in the short run? Long run? [4 marks]

Question 4 Read the adapted article below from BBC News and answer the following questions. FAST FASHION: ZARA PROMISES ALL ITS CLOTHES WILL BE SUSTAINABLE BY 2025 Zara - and other brands like Pull & Bear and Bershka - have promised to only sell sustainable clothes by 2025. The company that owns these shops says all cotton, linen and polyester they sell will be organic, sustainable or recycled. Zara has 64 UK stores, and its parent company has 7,490 shops worldwide. From next year, containers will appear in Zara stores to collect your old clothes so they can be reused or recycled into new items. Some people in the fashion industry have been calling for more clothes recycling in order to protect the environment - while politicians think brands and shops should fund clothes recycling. People in the UK send 235 million items of clothing to landfill each year, according to the most recent figures. Zara is one of the stores not to currently use plastic bags and Inditex, the company that owns the chain, says that by 2020 it will eliminate the use of plastic bags across all of its brands. Primark and Boots are among the big-name shops that have switched from plastic to paper bags. By 2023 Inditex promises it will have fully eliminated single use plastic in its stores. Inditex also has a scheme called Join Life running in its shops, which identifies clothes which are made with more environmentally friendly materials than conventional high street stores. These are made from things like organic cotton and recycled polyester. The boss of Inditex revealed the company's plans at its annual general meeting this week. "Sustainability is a never-ending task in which everyone here at Inditex is involved and in which we are successfully engaging all of our suppliers," said Pablo Isla, in front of shareholders and company executives