IB Economics HL Internal Assessment Exemplar: Tax jumps on wine and spirits but falls on fizz (microeconomics)

Diagrams are highly accurate with correctly labelled axes (price/quantity), curves (MPB, MSB, MSC=MPC, S + tax) and equilibrium points (A, B, C)

Includes two relevant diagrams (negative‐consumption externality and ad‐valorem tax) that clearly illustrate welfare loss and post‐tax equilibrium

Visual presentation supports the theoretical argument effectively, showing shifts and welfare triangles

The shaded welfare‐loss triangle is not directly labelled in the figure, requiring cross‐reference to the text

The post‐tax supply curve shift lacks a distinct label (e.g., “S + t”), which would clarify the incidence of the tax

Consistent and correct use of key economic terms such as “negative externality,” “demerit good,” “MPB,” “MSB,” “welfare loss,” “ad-valorem tax,” and “tax incidence”

Terminology is integrated seamlessly into explanations throughout the commentary

Occasional imprecise phrases (e.g., “negative marginal external benefits” instead of “negative marginal external costs”)

Use of “tax discrimination” is misleading; “differential tax rates” would be more precise