A-LevelEconomicsGovernment microeconomic intervention9708/12 · Feb/Mar 2016 · Q131 Mark
A company opened a garden to the public and charged for entry. The government then provided a grant to improve the garden on the condition that entry became free. What would result from the government's action?
AThe consumer surplus would increase.
BThe demand curve would shift to the left.
CThe supply curve would be infinitely elastic.
DThere would be no equilibrium position as the garden is free.
✓ Correct answer
A: The consumer surplus would increase.
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