A-LevelEconomicsThe price system and the microeconomy9708/22 · Feb/Mar 2019 · Q220 Marks

Section B Answer one question.

(a)Show how a production possibility curve can be used to explain scarcity, choice and opportunity cost.[8]
(b)Discuss whether the imposition of maximum prices can improve the allocation of scarce resources.[12]

This question uses a diagram from the original paper, which isn't shown here. Open the full paper from the past papers archive to see it.

Mark scheme

Marking points from the official mark scheme (Feb/Mar 2019). The mark or mark type is shown in brackets.

[2] For knowledge and understanding: an accurate diagram of a production possibility curve with appropriate axes.
[2] For application: using the production possibility curve to explain scarcity
[2] For application: using the production possibility curve to explain choice
[2] For application: using the production possibility curve to explain opportunity cost
[4] For analysis showing the impact on the market of maximum price set below the equilibrium price and the difficulties in allocation that will arise from the shortage created in the market.
[4] For analysis of the ways in which the problems of allocation that arise from the maximum price can be effectively overcome through for example rationing
[4] For evaluation that assesses the benefits of using maximum prices and whether the problems can be overcome and containing a conclusion

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