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Question 19M.1.SL.TZ1.a

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Date May 2019 Marks available [Maximum mark: 10] Reference code 19M.1.SL.TZ1.a
Level SL Paper 1 Time zone TZ1
Command term Explain Question number a Adapted from N/A
a.
[Maximum mark: 10]
19M.1.SL.TZ1.a

Explain the concepts of consumer surplus and producer surplus.

[10]

Markscheme

Marks should be allocated according to the paper 1 markbands for May 2013 forward, part A.

Answers may include:

  • definition of consumer surplus, producer surplus
  • diagram to show consumer surplus and producer surplus
  • explanation that consumer surplus is above equilibrium price and below the demand curve, and that producer surplus is below equilibrium price and above the supply curve
  • examples of consumer surplus and producer surplus.
Examiners report

This question was not answered well by most candidates who attempted it. Many confused consumer surplus with excess demand and producer surplus with excess supply. It was difficult for many candidates to give an accurate definition or explanation of the terms. Those that did understand the concepts provided precise definitions and were able to diagram the concepts well. However, candidates often struggled to give examples to illustrate the concepts.

Syllabus sections