O-LevelEconomicsThe allocation of resources2281/11 · May/June 2010 · Q71 Mark

The diagram shows the demand for and the supply of bread. A maximum price P₁ is fixed by the government. What is likely to be the immediate result of this? [Figure 7]

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Amovement of the demand curve to the right

Bmovement of the supply curve to the right

Cshortage of bread

Dsurplus of bread

✓ Correct answer

C: shortage of bread

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Topic: The allocation of resources, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, May/June 2010 Paper 1 Variant 1, question 7.

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