O-LevelEconomicsThe allocation of resources2281/12 · May/June 2022 · Q51 Mark

In recent years, a government has started to make more use of the free market system. However, they are doing it very slowly to avoid the disadvantages that a free market system might bring. What is a possible disadvantage of the free market system?

Adecreased incentive to work

Bdecreased levels of pollution

Cincreased efficiency

Dincreased inequality of income

✓ Correct answer

D: increased inequality of income

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Topic: The allocation of resources, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, May/June 2022 Paper 1 Variant 2, question 5.

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