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Date May 2018 Marks available 15 Reference code 18M.1.HL.TZ2.1
Level Higher level Paper Paper 1 Time zone Time zone 2
Command term Discuss Question number 1 Adapted from N/A

Question

Explain two reasons why a government might want to subsidize a good or service.

[10]
a.

Discuss the view that governments should tax the consumption of gasoline (petroleum).

[15]
b.

Markscheme

Answers may include:

Marks should be allocated according to the Paper 1 markbands for May 2013 forward, part A.

a.

Answers may include:

Discussion may include: consideration of reasons against (impact on business costs, impact on low income car owners), for example, some governments could subsidize it.

N.B.: It should be noted that definitions, theory, and examples that have already been given in part (a), and then referred to in part (b) should be rewarded.

Examiners should be aware that candidates may take a different approach which, if appropriate, should be rewarded.

Opinions or conclusions should be presented clearly and should be supported by appropriate examples.

Marks should be allocated according to the Paper 1 markbands for May 2013 forward, part B.

b.

Examiners report

[N/A]
a.
[N/A]
b.

Syllabus sections

Last exams 2021 » Section 1: Microeconomics » 1.3 Government intervention » Indirect taxes » Specific (fixed amount) taxes and ad valorem (percentage) taxes and their impact on markets
Last exams 2021 » Section 1: Microeconomics » 1.3 Government intervention » Indirect taxes
First exams 2022 » Unit 2: Microeconomics » 2.7 Role of government in microeconomics » 2.7.2 Main forms of government intervention in markets
First exams 2022 » Unit 2: Microeconomics » 2.7 Role of government in microeconomics » 2.7.3. Consequences of government intervention
Last exams 2021 » Section 1: Microeconomics » 1.3 Government intervention
First exams 2022 » Unit 2: Microeconomics » 2.7 Role of government in microeconomics
Last exams 2021 » Section 1: Microeconomics
First exams 2022 » Unit 2: Microeconomics
First exams 2022
Last exams 2021

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