O-LevelEconomicsThe allocation of resources2281/11 · May/June 2017 · Q71 Mark

A project to build one of the world's biggest coal mines was planned in Australia. The project was estimated to cost $US12.5 million. It would create employment but threaten endangered species as large coal ships would damage the Great Barrier Reef. What effects would this project have on the following costs and benefits? private cost | private benefit | external cost

Adecrease uncertain uncertain

Bincrease decrease increase

Cincrease increase increase

Duncertain increase increase

✓ Correct answer

C: increase increase increase

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Topic: The allocation of resources, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, May/June 2017 Paper 1 Variant 1, question 7.

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