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Economics (AS & A Level) · Oct / Nov 2022 · Paper 33 · Question 13

9708Government policies to achieve efficient resource allocation and correct market failure

A government regards fresh fruit and vegetables as merit goods, and subsidises agriculture to boost their production. What could be a government failure arising from these subsidies?

  1. Acheaper fresh fruit and vegetables
  2. Bland clearance reducing wildlife
  3. Clower spending on treating dietary illnesses
  4. Dmore jobs picking fruit and vegetables

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Correct answer: B. land clearance reducing wildlife

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