Economics (AS & A Level) · Oct / Nov 2021 · Paper 11 · Question 18
9708Methods and effects of government intervention in markets
An effective minimum price is applied to alcohol in an attempt to reduce consumption. Why would a government not buy up any surplus created?
- ABuying the surplus would be costly to the government.
- BBuying the surplus would decrease the incomes of producers.
- CBuying the surplus would lead to a shortage.
- DBuying the surplus would lead to unemployment.
As printed in the paper
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Correct answer: A. Buying the surplus would be costly to the government.
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