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

Maximum and minimum prices — practice question

The diagram illustrates the demand and supply curves for healthcare in a private market. What would happen if the government were to supply the same quantity of healthcare free of charge?

  • AHealthcare will become a public good.
  • BHealthcare will no longer have external benefits.
  • CThere will be over-consumption of healthcare.
  • DThere will need to be rationing.

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