A-LevelEconomicsGovernment InterventionMay/June 2025Paper 1 Q141 Mark
The diagram shows the demand and supply for rice. The market for rice is initially in equilibrium at a price of P₁. The government introduces a maximum price of Pmax. At the same time the supply of rice increases. [Figure 14.1] What is the impact of these changes on the market for rice?
Anew market equilibrium will be established.
BAn illegal market for rice will develop.
CThere will be a shortage of rice.
DThere will be a surplus of rice.
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The correct answer is A. This question tests the candidate's understanding of 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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