Economics (AS & A Level) · Oct / Nov 2022 · Paper 13 · Question 19
9708Methods and effects of government intervention in markets
A government wishes to influence the price of a good. It introduces a maximum price, Pmax, and a minimum price, Pmin. The diagram shows these prices relative to the current market price P. What can be concluded from the diagram?
- ABoth the maximum and the minimum price will be effective.
- BOnly the maximum price will be effective.
- COnly the minimum price will be effective.
- DThe market price will continue to operate.
As printed in the paper
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Correct answer: B. Only the maximum price will be effective.
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