A-LevelEconomicsMarket Failure and Government InterventionOct/Nov 2010Paper 1 Q181 Mark
In the diagram, S₁S₁ and DD represent the original supply and demand curves for an agricultural product. [Figure 18.1] Bad weather then reduces supply to S₂S₂. The government does not allow the price to rise above OP₁. How much of the product will the government have to supply from stocks if the price is to be maintained at OP₁?
AOQ₃
BQ₁Q₃
CQ₁Q₂
DQ₂Q₃
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The correct answer is B. 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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