A-LevelEconomicsGovernment microeconomic intervention9708/12 · May/June 2013 · Q151 Mark
A government decided to approve a private airport-building scheme because it was socially beneficial. In making its decision it calculated private costs at $700m, private benefits at $800m and external costs at $200m. What must have been true about the external benefits of the scheme?
AExternal benefits equalled private benefits.
BExternal benefits exceeded external costs.
CExternal benefits exceeded $100m.
DThere were no external benefits.
✓ Correct answer
C: External benefits exceeded $100m.
Practise more questions on this topic
Oracle Prep sorts past-paper questions by topic, so you can drill Government microeconomic intervention and see which topics are most likely to come up next.
Sign up free →