O-LevelEconomicsThe allocation of resources2281/11 · Oct/Nov 2010 · Q111 Mark

A government intends to build a new international airport in an area of outstanding natural beauty. What would be an external cost of this decision?

Athe cost of importing construction materials

Bthe countryside that is lost

Cthe increase in profits for local businesses

Dthe wages paid to the construction workers

✓ Correct answer

B: the countryside that is lost

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Topic: The allocation of resources, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, Oct/Nov 2010 Paper 1 Variant 1, question 11.

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