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A-LevelEconomicsGovernment microeconomic intervention9708/12 · May/June 2013 · Q141 Mark

Which is not an example of an externality?

AThe establishment of a new firm in an area increases the general level of wage rate area.
BThe flowers planted by a householder in his garden give pleasure to his neighbours.
CThe immunisation of children against smallpox reduces the danger of the risk of infection to others.
DThe installation of security cameras in a city centre results in an increase in thefts elsewhere.

✓ Correct answer

A: The establishment of a new firm in an area increases the general level of wage rate area.

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About this question

Topic
Government microeconomic intervention, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source
A-Level Economics, May/June 2013 Paper 1 Variant 2, question 14.

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