O-LevelEconomicsThe allocation of resources2281/12 · Oct/Nov 2017 · Q21 Mark

A government allowed a building company to construct new houses which destroyed an area designated as an area of natural beauty. Which concepts can be applied to this statement?

Abudget surplus; public sector

Bexternal cost; opportunity cost

Cgovernment subsidy; mixed economy

Dprivate enterprise; budget deficit

✓ Correct answer

B: external cost; opportunity cost

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Topic: The allocation of resources, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, Oct/Nov 2017 Paper 1 Variant 2, question 2.

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