Unit 2: Microeconomics

Topic 2.7: Role of Government in Microeconomics Questions

Practice 20 exam-style questions for IB Economics Topic 2.7. Review the question stems below, then unlock the full Question Bank to access markschemes, model answers, and AI grading.

1state3 marks
2026vault
State one possible objective of introducing a price ceiling on rent.
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2state4 marks
2026vault
State two reasons why a government might provide a subsidy.
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3explain4 marks
2026vault
Explain one opportunity cost of providing subsidies.
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41 mark
A per-unit subsidy of $s on a good will:
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5state4 marks
2026vault
State two reasons why a government might provide a subsidy.
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6state4 marks
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State two reasons why a government might impose an indirect tax.
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7define3 marks
2026vault
Define a price floor (minimum price).
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81 mark
An indirect tax on a good will shift:
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91 mark
A government subsidy on a good will shift:
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10explain4 marks
2026vault
Explain one opportunity cost of providing subsidies.
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11define3 marks
2026vault
Define a price ceiling (maximum price).
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12define3 marks
2026vault
Define a price ceiling (maximum price).
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13state3 marks
2026vault
State one objective of introducing a minimum wage.
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14state3 marks
2026vault
State one possible objective of introducing a price ceiling on rent.
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151 mark
A government subsidy on a good will shift:
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16define3 marks
2026vault
Define a price floor (minimum price).
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17state3 marks
2026vault
State one objective of introducing a minimum wage.
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18state4 marks
2026vault
State two reasons why a government might impose an indirect tax.
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191 mark
An indirect tax on a good will shift:
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20explain6 marks
2026vault
Explain why a binding price ceiling can lead to black markets.
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