6 marksIntervention
CAPE Economics Unit 1 · 2014 · Paper 2 · Question 4(b)(iii)
Outline THREE policies that the private sector can adopt to correct market failures.
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Practise this questionOther parts of this question
- 4(a)(i)Define the term 'public good'.[2 marks]
- 4(a)(ii)Explain why public goods are usually provided by the government.[3 marks]
- 4(b)(i)Define the term 'externality'.[2 marks]
- 4(b)(ii) a)Copy the diagram provided into your answer booklet and label it to illustrate a negative production externality.[4 marks]
- 4(b)(ii) b)Use the completed diagram to explain how negative externalities lead to market failure.[4 marks]
- 4(c)(i)Identify the issue being described.[1 mark]
- 4(c)(ii)Explain how the issue identified in (c)(i) leads to market failure.[3 marks]
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