A-LevelEconomicsThe price system and the microeconomy9708/32 · Feb/Mar 2019 · Q171 Mark
The diagram shows the market for a good that creates a negative externality in production and no positive externalities. The current level of consumption is OQ₁. [Diagram showing price and quantity axes; S₁, S₂, S₃, S₄ curves (S₁=MPC, S₂=MSC=MPC+MEC); D=MPB=MSB curve; price levels P₁, P₂, P₃, P₄ and quantity levels Q₁, Q₂, Q₃, Q₄; points V, W, X, Y, Z indicated]
- The government decides to tax producers of the good. Which size of tax on producers would result in a socially efficient allocation of resources? A VW B VX C VY D VZ[1]
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Mark scheme
Marking points from the official mark scheme (Feb/Mar 2019). The mark or mark type is shown in brackets.
- [1] B
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