A-LevelEconomicsMarket Failure and Government InterventionFeb/Mar 2018Paper 1 Q151 Mark
The diagram shows the equilibrium price and quantity of good X. [Figure 15.1] The initial market equilibrium is shown by point E. What might cause the market equilibrium to move to point F?
Adecrease in the costs of producing good X
Bdecrease in the demand for good X
Can increase in the price of a substitute good
Dthe imposition of a specific sales tax on producers of good X
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The correct answer is D. This question tests the candidate's understanding of market failure and government intervention within the Economicssyllabus. The examiner's mark scheme requires...
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Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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