CAIE A-Level Economics 8.2.2 Equity vs efficiency
Practise weighing fairer income distribution against incentive effects, efficiency losses and the case for redistribution.
- Syllabus
- 2026–2028
- Course
- Economics 9708
- Level
- A2
Exam points
- explain when redistribution is chosen because equity is valued above efficiency
- link higher tax rates to possible incentive effects for high earners
8.2.2—Equity vs efficiency question 1
[Maximum number: 1]
When is a policy of income redistribution from rich people to poor people most appropriate?
A
when control of demand-pull inflation is the priority
B
when equality is valued more highly than efficiency
C
when monetary reward is the best incentive to risk-taking
D
when the rich have higher marginal utility curves than the poor
B
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