IB skill practice

Analyse allocative efficiency and welfare loss

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

Paper 1, Paper 2 5 marks Difficulty 3

Interpret welfare loss from underallocation

A welfare diagram in a Wellington public policy debate shows output below the efficient quantity. Explain the deadweight loss. 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.