Government microeconomic intervention — AS & A Level Economics (9708) questions by topic
Externalities, merit and demerit goods, price controls and monopoly regulation sit at the centre of this A Level Economics topic, tested through multiple-choice diagram recognition and longer data-response parts worth from 1 to 20 marks.
Command words such as identify and explain build towards assess and evaluate, where marks reward a supported judgement on which policy actually redistributes income or corrects a market failure, not a list of options. This page draws on 151 real questions set between 2023 and 2025. Submitting full answers for instant marking is the fastest way to see whether your conclusion compares policies directly, since summative assertions without comparison consistently lose evaluation marks.
What examiners look for
- A recurring criticism is candidates giving imprecise or generic merit-good examples, such as 'food', while demerit-good examples are usually sharper.
- Examiners repeatedly note conclusions that are merely summative or assertive rather than directly comparing the advantages and disadvantages of the policies discussed, capping judgement marks.
- A common mistake is discussing alternatives to a subsidy instead of explaining why the subsidy itself would be ineffective, which makes evaluation irrelevant and caps marks at 4.
- Strong answers explain how a subsidy lowers costs and prices, then analyse effectiveness against price elasticity of demand and the persistence of information failure.
- Reports praise candidates who weigh strengths and weaknesses of each policy before judging which is likely best, for example by considering the ability to control illegal markets.
May–June 2025, Paper 11
What is an example of wealth? A interest received B profits C property D incomes
Answer this question and get it marked →Too much sugar causes an increase in a consumer's weight. A government has introduced a 'sugar tax' on the consumption of soft drinks that have a high sugar content. How might…
Answer this question and get it marked →A ......1...... price set below the market equilibrium will cause a ......2...... of the product, and a ......3...... price set above the market equilibrium will cause a…
Answer this question and get it marked →The diagram shows the demand for and supply of eye tests provided by opticians. [Diagram: axes 'price' (vertical, marked P1, P2, P3 in ascending order) and 'quantity' (horizontal,…
Answer this question and get it marked →A government decides to raise most of its revenues from indirect taxes. What would increase the effectiveness of this policy? A an increasing trend towards bartering of goods B…
Answer this question and get it marked →May–June 2025, Paper 12
An indirect tax is imposed on good X. Which situation is most likely to result in producers bearing a higher burden of the tax? A price elasticity of demand is elastic B price…
Answer this question and get it marked →Why might governments provide free education for children aged 4 to 16 years old? A Consumers are not fully aware of the benefits of education. B Education in a free market system…
Answer this question and get it marked →The diagram shows the demand and supply for rice. The market for rice is initially in equilibrium at a price of P1 (quantity Q1). The government introduces a maximum price of Pmax…
Answer this question and get it marked →In the diagram, D is the demand curve of an agricultural commodity and S is the initial supply curve. The initial equilibrium is at a price of $4 and a quantity of 2 ('000…
Answer this question and get it marked →May–June 2025, Paper 13
A flood-control dam is an example of a good provided directly by a government. Which statement relating to the direct provision of a flood-control dam is not correct? A It allows…
Answer this question and get it marked →A country depends heavily on the production of an agricultural product, good X. It decides to introduce a buffer stock scheme for good X. The government allocates a fixed amount…
Answer this question and get it marked →The graph shows an individual's income before and after the deduction of income tax. [Graph: income after tax ($) on the vertical axis, income before tax ($) on the horizontal…
Answer this question and get it marked →May–June 2025, Paper 21
With the help of a diagram, explain how changes in a subsidy can influence the price and quantity sold of a product in a market and consider how expenditure on a subsidy is…
Answer this question and get it marked →May–June 2025, Paper 23
Explain what is meant by a merit good and why governments provide merit goods such as healthcare free of charge and consider why such provision may not always be successful. [8]
Answer this question and get it marked →May–June 2025, Paper 24
With the help of a diagram, explain the impact of introducing an effective minimum price for a product and consider the effect on the consumer surplus for that product.
Answer this question and get it marked →May–June 2025, Paper 31
Good X is a popular product that creates a negative externality when it is consumed. The government wants to reduce the consumption of good X significantly. Under which…
Answer this question and get it marked →A government introduces tradeable pollution permits to reduce pollution. What is an advantage of this scheme? A It allows consumers to determine the optimum pollution level. B It…
Answer this question and get it marked →To reduce traffic congestion, a government built a new highway. A majority of the citizens were opposed to this. Some citizens responded by switching from public transport to…
Answer this question and get it marked →What could result in an individual being caught in the poverty trap if their income increases? A national minimum wage is changed B benefits payments are means-tested C subsidised…
Answer this question and get it marked →The diagram shows the impact on the labour market of the introduction of a national minimum wage (MW). [Diagram: axes are 'wage rate' (vertical) and 'labour' (horizontal). An…
Answer this question and get it marked →What is an example of 'nudge' theory as applied to the prevention of tax evasion? A employing an extensive administration to ensure detection of evasion B imposing heavy penalties…
Answer this question and get it marked →May–June 2025, Paper 32
When is allocative efficiency achieved? A when a perfectly competitive market is in equilibrium B when everybody who needs the product can obtain it C when firms produce at the…
Answer this question and get it marked →When might a moral hazard occur? A When a consumer does not have full information about a product. B When a person undertakes an activity that causes harm to another person. C…
Answer this question and get it marked →The marginal social benefit of consuming a drink is less than the marginal private benefit. What would be the best policy to improve resource allocation in this market? A give a…
Answer this question and get it marked →A country's government banned cigarette smoking in enclosed public spaces, such as offices, shops, bars and restaurants. What is a government failure arising from this ban? A…
Answer this question and get it marked →What is not an outcome of the existence of private property rights? A They encourage private owners to conserve property when its value is expected to rise. B They give private…
Answer this question and get it marked →May–June 2025, Paper 33
The diagram shows the cost and revenue curves for a natural monopoly. [Diagram: axes of 'price' (vertical) and 'quantity' (horizontal). A downward-sloping AR (demand) curve and a…
Answer this question and get it marked →Good X is a popular product that creates a negative externality when it is consumed. The government wants to reduce the consumption of good X significantly. Under which…
Answer this question and get it marked →A government introduces tradeable pollution permits to reduce pollution. What is an advantage of this scheme? A It allows consumers to determine the optimum pollution level. B It…
Answer this question and get it marked →To reduce traffic congestion, a government built a new highway. A majority of the citizens were opposed to this. Some citizens responded by switching from public transport to…
Answer this question and get it marked →What could result in an individual being caught in the poverty trap if their income increases? A national minimum wage is changed B benefits payments are means-tested C subsidised…
Answer this question and get it marked →The diagram shows the impact on the labour market of the introduction of a national minimum wage (MW). [Diagram: axes of 'wage rate' (vertical) and 'labour' (horizontal). An…
Answer this question and get it marked →What is an example of 'nudge' theory as applied to the prevention of tax evasion? A employing an extensive administration to ensure detection of evasion B imposing heavy penalties…
Answer this question and get it marked →May–June 2025, Paper 34
What is the most likely combination of circumstances leading to a good being under-consumed? the good is a demerit good there are external benefits in consumption --- --- --- A no…
Answer this question and get it marked →Why does the lack of property rights cause an inefficient allocation of resources? A Scarce resources are depleted because the owner has sold them too cheaply. B Scarce resources…
Answer this question and get it marked →A cost–benefit analysis is carried out on the construction of a hydroelectric power station. Under which circumstances would the scheme be most likely to be approved? A Private…
Answer this question and get it marked →The diagram shows the private and social marginal costs and benefits of a manufacturer. The current equilibrium is at point R. [Diagram: axes labelled 'cost, benefit' (vertical)…
Answer this question and get it marked →What indicates that a more equal distribution of income has been achieved? A a faster rate of economic growth B a higher Human Development Index C a lower Gini coefficient D a…
Answer this question and get it marked →Which policy by a government would increase the negative externalities that result from cigarette smoking? A a ban on cigarette advertising B a ban on cigarette smoking in public…
Answer this question and get it marked →May–June 2025, Paper 42
Define economic sustainability and give one example from the information of a change that can be used to illustrate it.
Answer this question and get it marked →May–June 2025, Paper 44
With the help of a diagram, consider whether economic efficiency can be achieved without government intervention in a market economy. [20]
Answer this question and get it marked →May–June 2024, Paper 11
A government wishes to raise the incomes of farmers without raising the price of food to consumers. Which policy should it use? A a maximum price below the market price for food B…
Answer this question and get it marked →May–June 2024, Paper 12
A market is in equilibrium. The government intervenes by creating a price floor below which the market price cannot fall. Which term describes this form of government…
Answer this question and get it marked →What is an example of a public good? A a new road linking a major city with a port B free lunches provided to students at a school C Wi-Fi (internet access) provided for all the…
Answer this question and get it marked →The diagram shows an initial market equilibrium for an agricultural product of $6 and 800 units. [Diagram: 'price ($)' on the vertical axis (values 0, 6 and 10 marked) and…
Answer this question and get it marked →May–June 2024, Paper 13
A government introduces an effective minimum price for a product but makes no other intervention in the market. This policy suggests that the government’s objective is A to…
Answer this question and get it marked →The diagram shows the effect of an indirect tax imposed on cigarettes. The market is initially in equilibrium at point X. Which area represents the incidence of the tax on…
Answer this question and get it marked →May–June 2024, Paper 22
Explain how the Gini coefficient is used to measure income inequality and consider the relative strength of two economic reasons suggested for such inequality in a low-income…
Answer this question and get it marked →With the help of an example of each, explain the difference between a merit good and a demerit good and consider whether a subsidy given to a merit good will always be effective…
Answer this question and get it marked →May–June 2024, Paper 31
A medical team provides vaccinations for children to prevent an outbreak of an infectious disease. Why would this be described as a positive externality? A Additional benefit…
Answer this question and get it marked →An economic activity definitely creates a net social benefit when the value of social benefit minus A private benefit is zero. B private benefit is negative. C social cost is…
Answer this question and get it marked →The government can use policies to try and reduce the environmental damage caused by the amount of rubbish (garbage) created by firms and households. Which policy to reduce…
Answer this question and get it marked →What would supporters of a nationalised public transport service expect to be the most likely outcome from the privatisation of train and bus services? A fewer destinations served…
Answer this question and get it marked →What will cause a household to be caught in the poverty trap? A A household earns less than the international poverty line of $2.15 per person per day. B A household spends more…
Answer this question and get it marked →Singapore has one of the highest population densities in the world. It discourages car use through a high tax on second cars. Which additional policy would help to relieve road…
Answer this question and get it marked →The table shows the values of the Gini coefficient for some countries in a given year. Gini coefficient --- --- Namibia 74.3 Zambia 50.4 France 32.7 Denmark 24.7 Using this…
Answer this question and get it marked →May–June 2024, Paper 32
Which combination of costs and benefits will lead to an increase in net social costs? private benefits external benefits private costs external costs --- --- --- --- --- A falls…
Answer this question and get it marked →The diagram shows the costs and benefits of producing steel in a free market. [Diagram: axes labelled ‘cost, benefit’ (vertical) and ‘output’ (horizontal), origin O. Two…
Answer this question and get it marked →A government wants to introduce a policy that will reduce the pollution caused by the production of a good. Which policy would not make use of market forces? A a quota to limit…
Answer this question and get it marked →The table shows the annual percentage change in the output per worker employed for four nationalised industries before and after privatisation. nationalised industry before…
Answer this question and get it marked →May–June 2024, Paper 33
A medical team provides vaccinations for children to prevent an outbreak of an infectious disease. Why would this be described as a positive externality? A Additional benefit…
Answer this question and get it marked →An economic activity definitely creates a net social benefit when the value of social benefit minus A private benefit is zero. B private benefit is negative. C social cost is…
Answer this question and get it marked →The government can use policies to try and reduce the environmental damage caused by the amount of rubbish (garbage) created by firms and households. Which policy to reduce…
Answer this question and get it marked →What would supporters of a nationalised public transport service expect to be the most likely outcome from the privatisation of train and bus services? A fewer destinations served…
Answer this question and get it marked →What will cause a household to be caught in the poverty trap? A A household earns less than the international poverty line of $2.15 per person per day. B A household spends more…
Answer this question and get it marked →What will cause an outward shift in the demand for labour curve? A a decrease in the top rate of income tax B an increase in the demand for the final product C an increase in…
Answer this question and get it marked →The diagram shows what happens when the employees of a profit-maximising monopsonist employer form a trade union and successfully negotiate a wage rate of OWT. [Diagram: vertical…
Answer this question and get it marked →Singapore has one of the highest population densities in the world. It discourages car use through a high tax on second cars. Which additional policy would help to relieve road…
Answer this question and get it marked →The table shows the values of the Gini coefficient for some countries in a given year. Gini coefficient --- --- Namibia 74.3 Zambia 50.4 France 32.7 Denmark 24.7 Using this…
Answer this question and get it marked →May–June 2024, Paper 42
Market failure exists in all economies. Evaluate, with the aid of a diagram(s), the meaning of market failure and two policies a government may use to correct market failure. [20]
Answer this question and get it marked →May–June 2024, Paper 43
The long-term equilibrium position in perfect competition is frequently used to illustrate efficient resource allocation in a free market economy. Explain why this is so and…
Answer this question and get it marked →October–November 2024, Paper 11
Which government action would be identified as the direct provision of goods and services? A increasing road maintenance because of poor weather conditions B making payments to…
Answer this question and get it marked →A specific tax is imposed on a product for which the elasticity of supply is zero. Which statement is correct? A The burden of this tax will fall entirely on consumers. B The…
Answer this question and get it marked →A government wishes to intervene in a free market to allocate healthcare at the socially optimal level. Which combination correctly identifies the reason for government…
Answer this question and get it marked →October–November 2024, Paper 12
In the diagram, S₁ and S₂ are the supply curves for an agricultural product in years 1 and 2 respectively. D is the demand curve in years 1 and 2. In year 1, the government…
Answer this question and get it marked →A product with infinite elasticity of supply has sales of 1000 units a week at a price of $1 per unit. Price elasticity of demand is 1.5 over the relevant range. The government…
Answer this question and get it marked →October–November 2024, Paper 13
A government wishes to encourage the consumption of a merit good and reduce the consumption of a demerit good. Which policy should it adopt towards each good? merit good demerit…
Answer this question and get it marked →October–November 2024, Paper 23
With the aid of examples, explain the characteristics of public goods and free goods and consider whether free-of-charge vaccinations offered by a government should be classified…
Answer this question and get it marked →Explain two economic reasons for inequality in the distribution of income and wealth and consider why inequality in the distribution of wealth cannot easily be measured.
Answer this question and get it marked →October–November 2024, Paper 31
Which government policy would not be classified as regulation? A a ban on cocaine consumption B compulsory wearing of seatbelts in cars C licences for the extraction of water from…
Answer this question and get it marked →A government removes a subsidy on a rural school bus service. What is the effect of this on the market for this bus service? A Deadweight loss decreases. B Private marginal costs…
Answer this question and get it marked →October–November 2024, Paper 32
A government makes it compulsory for motorbike riders to wear helmets. What would represent a positive externality of consumption associated with this decision? A decreased…
Answer this question and get it marked →The diagram shows the marginal private benefit (MPB), the marginal private cost (MPC) and the marginal social cost (MSC) for firms in an industry. The equilibrium price is point…
Answer this question and get it marked →What is not a valid comment economists may make regarding the need to subsidise a green energy market that uses solar and wind power? A It is cheaper to use the plentiful supply…
Answer this question and get it marked →October–November 2024, Paper 33
A government decides to use price controls to achieve allocative efficiency in a monopoly market. Which price would need to be set to achieve allocative efficiency? [Diagram:…
Answer this question and get it marked →The diagram shows the supply of and the demand for workers in the car manufacturing industry. A trade union successfully negotiates a wage increase from W₁ to W₂. [Diagram:…
Answer this question and get it marked →A firm buys new machinery which increases the marginal productivity of its workforce. What will be the resulting impact on the market for labour? A a shift to the left in the…
Answer this question and get it marked →The diagram represents the market for labour. [Diagram: vertical axis labelled 'wage', horizontal axis labelled 'number of workers', origin O. A downward-sloping demand curve D…
Answer this question and get it marked →Which combination of policies is most likely to increase the number of low-paid workers caught in the poverty trap? individual's tax-free allowance for income tax proportion of…
Answer this question and get it marked →October–November 2024, Paper 41
Governments in many countries are promoting policies that reduce the impact of the negative externalities. Evaluate, using appropriate diagram(s), the extent to which two policies…
Answer this question and get it marked →October–November 2024, Paper 42
Privatisation is often required by the International Monetary Fund (IMF) and the World Bank before they are prepared to offer support to countries requiring loans, grants, debt…
Answer this question and get it marked →October–November 2024, Paper 43
Negative externalities of production cause market failure. With the help of a diagram, assess the extent to which the introduction of indirect taxation is likely to address this…
Answer this question and get it marked →May–June 2023, Paper 11
A specific tax is placed on the sale of bottles of lemonade. In the diagram, S is the supply curve before imposition of the tax and St is the supply curve after tax. [Diagram: the…
Answer this question and get it marked →Demand for medical face masks exceeds supply during a disease outbreak. What is the most likely cause of this excess demand? A Some consumers do not have effective demand. B The…
Answer this question and get it marked →The diagram shows the demand and supply curves for a good. [Diagram: the vertical axis is price and the horizontal axis is quantity, with origin O. An upward-sloping supply curve…
Answer this question and get it marked →May–June 2023, Paper 12
A specific tax is placed upon each bottle of perfume sold. In the diagram, S is the supply curve before tax, St is the supply curve after tax. Which area represents that part of…
Answer this question and get it marked →Which combination of government measures is most likely to increase the consumption of a merit good? A setting an effective maximum price on the product and paying producers a…
Answer this question and get it marked →May–June 2023, Paper 13
There are 10 000 tickets available to watch a sports final at a national stadium. The initial market equilibrium ticket price is $20. The government decides to fix an effective…
Answer this question and get it marked →The diagram shows the impact of a government imposing a unit tax on a demerit good. S is the supply curve before the tax and S₁ is the supply curve after the tax. [Diagram: 'price…
Answer this question and get it marked →A government has a policy aim of reducing income inequality. It considers three policies. Which combination of policies would be most effective? an increase in the marginal rate…
Answer this question and get it marked →May–June 2023, Paper 23
Explain why government intervention may be required to provide merit goods and consider why such intervention may not always be successful.
Answer this question and get it marked →May–June 2023, Paper 31
What is an example of an external cost? A distribution costs B energy costs C labour costs D road congestion costs
Answer this question and get it marked →The diagram shows the demand for and supply of a good and the marginal social costs (MSC) for that good. [Diagram: vertical axis labelled 'costs, revenue', horizontal axis…
Answer this question and get it marked →One reason for market failure is the existence of public goods. Which policy option is appropriate for addressing such a market failure? A direct provision of the good by the…
Answer this question and get it marked →In 2020, the governor of California issued an order to ban the sale of new vehicles from 2035 that are powered by petrol or diesel fuel. Which type of government policy is this? A…
Answer this question and get it marked →A reason for government intervention in the workings of the economy is to attempt to correct a market failure. Sometimes, though, government failure may occur. What is not a…
Answer this question and get it marked →A government wishes to support growth in the economy's fishing industry. Which policy is likely to achieve sustainable growth in the fishing industry? A giving more modern fishing…
Answer this question and get it marked →May–June 2023, Paper 32
Studies show that some dentists replace patients’ teeth more often than is necessary. Which factor helps to explain why excessive dental treatment may take place? A the existence…
Answer this question and get it marked →Which statement is correct? A External benefit minus private benefit equals social benefit. B Private benefit minus external benefit equals social benefit. C Social benefit minus…
Answer this question and get it marked →What can be done to help to overcome moral hazard? A charging the same insurance premium to all people in the same age group B designing insurance contracts so that the insurance…
Answer this question and get it marked →Which action would produce a positive externality of production? A A child is vaccinated against measles. B A consumer donates products to a local food bank. C A firm rebuilds a…
Answer this question and get it marked →A government hopes to build an athletics stadium to hold the World Games. The stadium would have high private and external costs, but it would increase national pride. Why would…
Answer this question and get it marked →What is likely to cause a more equal distribution of income in the long run? A a reduction in the top rate of taxation B an increase in government spending on education and…
Answer this question and get it marked →A government imposes a maximum price for electricity. Which statement justifying this measure might be considered valid on economic grounds? A It will encourage electricity…
Answer this question and get it marked →May–June 2023, Paper 33
What is an example of an external cost? A distribution costs B energy costs C labour costs D road congestion costs
Answer this question and get it marked →The diagram shows the demand for and supply of a good and the marginal social costs (MSC) for that good. [Diagram: axes of 'costs, revenue' (vertical) and 'output' (horizontal),…
Answer this question and get it marked →One reason for market failure is the existence of public goods. Which policy option is appropriate for addressing such a market failure? A direct provision of the good by the…
Answer this question and get it marked →In 2020, the governor of California issued an order to ban the sale of new vehicles from 2035 that are powered by petrol or diesel fuel. Which type of government policy is this? A…
Answer this question and get it marked →A reason for government intervention in the workings of the economy is to attempt to correct a market failure. Sometimes, though, government failure may occur. What is not a…
Answer this question and get it marked →May–June 2023, Paper 41
To improve allocative efficiency economists frequently advise governments to remove existing subsidies to the private sector providers of education. With the help of a diagram,…
Answer this question and get it marked →May–June 2023, Paper 42
The increased use of electric vehicles (EVs) is encouraged as part of governments' climate change policies because they create fewer negative externalities than diesel and petrol…
Answer this question and get it marked →May–June 2023, Paper 43
To improve allocative efficiency economists frequently advise governments to remove existing subsidies to the private sector providers of education. With the help of a diagram,…
Answer this question and get it marked →October–November 2023, Paper 11
A government introduces charges for vehicles using the roads in its capital city. Which characteristic must the roads have for this to be successful in reducing congestion? A The…
Answer this question and get it marked →October–November 2023, Paper 12
Some goods are over-consumed in a market economy. What is likely to be the cause of this? A Consumer surplus exceeds producer surplus. B Consumers undervalue the benefits of…
Answer this question and get it marked →What is most likely to be regressive? A corporate profit taxes B state pension benefits C specific tax on cigarettes D unemployment benefits
Answer this question and get it marked →The government imposes a specific indirect tax of $1 on each unit of a good sold. How does the imposition of the tax shift the demand or supply curve of the good? A The demand…
Answer this question and get it marked →October–November 2023, Paper 13
Consumers do not use enough of a product to maximise their private benefit because they have imperfect information about the product. How would an economist classify this product?…
Answer this question and get it marked →In the diagram, the demand and supply curves for wheat in Australia are shown. Initial equilibrium is at X. The government imposes a sales tax on wheat at the same time as…
Answer this question and get it marked →A free market is currently experiencing excess supply at a price of P₁. What will be the effect on the current market situation if a maximum price is set above P₁? A The excess…
Answer this question and get it marked →What is a likely disadvantage of a government’s provision of transfer payments to the unemployed? A decrease in the standard of living B disincentive to accept paid work C…
Answer this question and get it marked →Which combination of policies would increase the inequality of the distribution of income and wealth? progressive taxes minimum wage transfer payments --- --- --- --- A decrease…
Answer this question and get it marked →October–November 2023, Paper 21
Explain why a government might decide to increase its direct provision of essential goods and services and consider whether such a policy is always likely to be successful.
Answer this question and get it marked →October–November 2023, Paper 22
With the help of examples, explain the difference between free goods and public goods and consider the view that public goods can never be provided in a market economy.
Answer this question and get it marked →October–November 2023, Paper 23
Explain why the provision of bus and local rail (mass transit) services in cities is classified as a private good not a public good and consider why such services might only be…
Answer this question and get it marked →October–November 2023, Paper 31
A city council is considering building a passenger terminal at its port so that the city can benefit from large cruise ships that could then dock there. It undertakes a…
Answer this question and get it marked →Some multinational oil companies extracting oil in developing countries are now required to repair the damage they do to the environment. What best describes the total costs…
Answer this question and get it marked →Which statement is not an example of government failure? A government intervention leading to a less efficient allocation of resources B government intervention leading to a net…
Answer this question and get it marked →The diagram shows the demand for and supply of labour. [Diagram: the vertical axis is wage and the horizontal axis is quantity of labour. The supply of labour curve SL slopes…
Answer this question and get it marked →Under which circumstances will a subsidy from the government be most beneficial if there are externalities from producing good X? externality caused by good X price elasticity of…
Answer this question and get it marked →October–November 2023, Paper 32
Negative externalities, such as air pollution due to car emissions, can cause damage to people's health in cities. Which response is most likely to occur from this situation? A…
Answer this question and get it marked →What is not an example of a moral hazard? A People with a higher risk of unemployment are more likely to undertake training. B People with free dental care are less likely to take…
Answer this question and get it marked →In recent years, the fuel cost of operating a jet aircraft has declined. Over the same period, improved design has led to much quieter aircraft. How would this affect the marginal…
Answer this question and get it marked →What is the economic result of a universal basic income (UBI)? reduces the incentive to work improves equality --- --- --- A no no B no yes C yes no D yes yes
Answer this question and get it marked →Which combination of fiscal policy measures would be most effective in reducing income inequality? top rates of income tax indirect taxes value of state benefits --- --- --- --- A…
Answer this question and get it marked →At present, motorists who drive their cars within area 1 on the map pay a daily congestion charge of $8. [Map: a rectangle containing two concentric shaded ovals. The inner,…
Answer this question and get it marked →When assessing income distribution in an economy, which change in the Gini coefficient suggests that a country is distributing its income more equally? A It has moved closer to…
Answer this question and get it marked →October–November 2023, Paper 33
A traffic study concluded that there would be significant benefits if 10% of car drivers switched to using motorcycles during peak traffic times. Which benefit of this change…
Answer this question and get it marked →Which policy is not designed to correct a market failure? A government provision of healthcare B price controls on large firms C regulations to limit smoke pollution D introducing…
Answer this question and get it marked →To control the cost of living, governments have sometimes imposed a maximum price on certain goods that is below the free market price. What is often an undesirable side effect of…
Answer this question and get it marked →October–November 2023, Paper 41
The provision of health care by the public sector is inefficient and therefore all health care should be provided by firms operating in the private sector. Evaluate this comment.
Answer this question and get it marked →October–November 2023, Paper 43
Pollution is caused when consumers or producers make decisions based on self-interest. This is a sign of market failure. With the help of a diagram, evaluate the extent to which…
Answer this question and get it marked →