A farm buys pesticide to use on its crops. Pesticide from the farm harms bees kept by a beekeeper nearby, who is not involved in the farm's purchases or sales. The government introduces an indirect tax on pesticide sales. Table 1 shows the quantity of pesticide bought by the farm in one season before and after the tax.
| Period | Quantity bought (litres) |
|---|---|
| Before the tax | 100 |
| After the tax | 80 |
Using Table 1, calculate the percentage decrease in the quantity of pesticide bought. Explain how this change could affect the cost imposed on the beekeeper.
83 exam-style questions on AQA GCSE Economics 1.6 Market failure, covering 1.6.1a Market failure as misallocation of resources, 1.6.1b Government intervention, 1.6.2a Defining externalities, and 1.6.2b Positive and negative externalities. Each one has a worked solution and a mark scheme showing where the marks go.