A-LevelEconomicsGovernment Microeconomic InterventionOct/Nov 2013Paper 1 Q111 Mark
The diagram shows the market for sugar which is in equilibrium at a price of OP. [Figure 11.1] A government then fixes a maximum price of OP₁. What will happen as a result?
Aan increase in consumer surplus equal to PRUP₁
Breduction in expenditure by people who still buy sugar equal to PQSP₁
Creduction in farmers' receipts equal to QRML
Dfarmers' receipts would be PQLO
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The correct answer is B. This question tests the candidate's understanding of government microeconomic 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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