IB skill practice

Analyse indirect taxes, subsidies, and price controls

Economics SL skill with original exam-style diagram and data-response seeds.

Paper 1, Paper 2 5 marks Difficulty 4

Analyse an indirect tax

A government in a local Australian renewable energy example places an indirect tax on sugary drinks. Use a demand and supply diagram to explain the effect on price and quantity. Enter the answer and choose the interpretation that best matches the economic evidence.

Worked practice: economic evidence and answer

Identify the economic evidence first, then state the result and interpretation.