A-LevelEconomicsMarket Failure and Government InterventionMay/June 2014Paper 1 Q151 Mark
A firm opens a new factory on derelict ground on the outskirts of a town. What will be included among the externalities arising from the opening of the new factory? [Table showing impact on 'an increase in air pollution', 'an increase in the rents of neighbouring factory sites', 'the change in the appearance of the neighbourhood' for options A, B, C, D]
Aan increase in air pollution: no, an increase in the rents of neighbouring factory sites: no, the change in the appearance of the neighbourhood: yes
Ban increase in air pollution: no, an increase in the rents of neighbouring factory sites: yes, the change in the appearance of the neighbourhood: no
Can increase in air pollution: yes, an increase in the rents of neighbouring factory sites: no, the change in the appearance of the neighbourhood: yes
Dan increase in air pollution: yes, an increase in the rents of neighbouring factory sites: yes, the change in the appearance of the neighbourhood: no
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of market failure and government intervention within the Economicssyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
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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