Question 1 a) The type of market structure the automobile industry belongs to monopolistic competition. The characteristic of this market is that they are freedom of entry and exit. Second is they are similar, but not identical goods. b) The reason that the drop in the sales of cars early year is because the election in May, there were rumors about the price reduction for other cars. In reason of the price of the other cars decreasing, the sales of Mercedes-benze E-class was dropping. c) The two factors that would attract the customers to buy the new E-class sedan Model are sporty and dynamic looks, because it will make purchaser attention in reason of it attractive outlook. Second factor is about the innovative of the safety technologies, because of the modern technology of this product, it makes a lot purchaser feel curios so it could be the factor of would attract the customers. d) The consequence that government cut the petroleum subsidy, the demand for car will decrease, in reason of petroleum and car are complementary good. complementary good is define as a good whose use is related to the use of an associated or paired good. Therefore it might effect the demand of car. According to the diagram 1, when the price of petroleum increase, the quantity demand of petroleum will decreasing, because it is negative relationship. Besides, base on the diagram 2 showing that the demand of cars. When the price of petroleum increase, the demand of cars are affected, as an observe we can see that the demand curve is shift to the left. Getting to this point, we know that the quantity demand of cars are decreasing, although the price of cars are same. e) The 4 barriers to entry are brand loyalty through advertising, predatory pricing, economics of scale and network effects. Brand Loyalty through advertising is developing consumer loyalty through