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A-LevelEconomicsGovernment Microeconomic InterventionOct/Nov 2018Paper 3 Q131 Mark

A private company operates a coal mine which employs 400 workers. The mining operations have polluted the environment and created external costs. If the government intervenes, how could it internalise the externality? A close part of the mine and import the coal B levy an additional tax on the miners' wages equal to the external cost C pay for the external costs of restoring the environment after mining D place a tax equivalent to the external cost on the output the company produces

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About This A-Level Economics Question

This structured question appeared in the Cambridge A-Level Economics (9708) Oct/Nov 2018 examination, Paper 3 Variant 1. It tests the topic of Government Microeconomic Intervention and is worth 1 mark.

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