Economics 9708 · AS & A Level · Maximum and minimum prices

Maximum and minimum prices — practice question

In November 2017, the Scottish government put in place a minimum price for alcohol due to the harmful health consequences of drinking alcohol. Which combination of actions is most likely to lead to a failure in reducing the harmful effects of alcohol consumption?

  • Aminimum price is set too high; effective information provision regarding the health effects of consuming alcohol
  • Bminimum price is set too high; effective subsidisation of non-alcoholic beverages
  • Cminimum price is set too low; health benefits of reduced alcohol consumption have been overestimated
  • Dminimum price is set too low; stricter enforcement of the regulations relating to the sale of alcohol

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