A-LevelEconomicsGovernment Intervention in MarketsMay/June 2013Paper 1 Q161 Mark
A tax on a product is removed causing supply to increase from SS to S₁S₁ as s diagram. What effect does the move have on government tax revenue and consumer expenditure? [Figure 16.1 showing supply and demand curves with a tax removal]
Areduce by $80 increase by $280
Breduce by $80 increase by $480
Creduce by $200 increase by $280
Dreduce by $200 increase by $480
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of government intervention in markets within the Economicssyllabus. The examiner's mark scheme requires...
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Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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