A-LevelEconomicsGovernment Intervention in MarketsMay/June 2016Paper 1 Q121 Mark
The diagram shows the demand curve and supply curve for a good on which the government imposes a specific tax. [Figure X.X] What will be the result of this tax?
AMost of the incidence of the tax will fall on the producer.
BThere will be a new demand curve parallel to DD.
CThe price will rise by the full amount of the tax.
DThe quantity bought will fall proportionately to the tax rate.
✓ Correct Answer
The correct answer is A. This question tests the candidate's understanding of government intervention in markets 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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