20 Marker Examples

Question 1

Maximum Price on Housing (2023)

Question: Evaluate the impact of a maximum price on the market for housing.

Answer 1

Real-world examples:
• Berlin Rent Cap (2020–2021): Germany introduced a rent freeze in Berlin, capping rent increases. It led to reduced supply as landlords pulled properties from the rental market, and it was struck down as unconstitutional.

Question 2

Negative Externalities and Government Intervention (2022)

Question: Assess the effectiveness of government intervention in correcting market failure due to negative externalities.

Answer 2

Real-world examples:
• Plastic Bag Charges (UK 2015): A 5p charge led to an over 80% reduction in plastic bag use.
• Carbon Tax in Sweden: Introduced in 1991, it is widely cited as highly effective in reducing CO₂ emissions while maintaining economic growth.

Question 3

Subsidies on Electric Vehicles (2020)

Question: Evaluate the impact of a subsidy on the market for electric vehicles (EVs).

Answer 3

Real-world examples:
• UK Plug-in Grant (up to 2022): Helped increase EV sales—Tesla Model 3 became one of the best-selling cars in 2021.
• Norway EV subsidies: Massive uptake of EVs, which made up over 70% of new car sales in 2020—demonstrates strong market shift due to generous subsidies and tax breaks.