What is the role of Government in the market place?
Describe supply and demand; and give their lucidly definitions with Examples
1) A market economy refers to an economic system in which the decisions about the investment, production and distribution are taken by the forces of demand and supply. The primary functions of government in a market economy are as follows:
1. Efficiency: The government must attempt to correct market failures such as excessive pollution and monopoly to ensure efficient functioning of the economic system. Externalities (or social costs) arise when firms or people impose benefits or costs on others outside the marketplace
2. Equity: Government programmes targets for promoting the equity use taxes and spending for the redistribution of income toward particular groups
3. Infrastructure: The government should provide an integrated infrastructure to directly or indirectly improve the output levels or efficiency in production.
4. Economic Growth or Stability: The governments rely upon taxes, monetary regulation and expenditures to enhance the macroeconomic stability and growth to reduce inflation and unemployment while encouraging economic growth
2) Demand and supply is one of the most vital concepts in economics. Demand represents the ability and desire of consumers to purchase a good at a range of different prices. Supply represents the amount of a good which the producers are willing to offer for sale at a different range of prices. The price at which the demand and supply curves intersect is termed to be an equilibrium at which all of the good that is offered will be purchased. Example:
When supply of a product increases, the price of a product falls and demand for the product can increase as it costs loss.
There is a drought and very few bananas are available in the market. More people desires the bananas than it's availability. The price of bananas increases dramatically.
What is the role of Government in the market place? Describe supply and demand; and give...
Economists who study the role of government in the market A. agree mostly on the role that the government should play. B. study for market problems that the government might help solve. C. find that supply and demand graphs never work for the government. D. none of these answer options are correct.
considering the principles of supply, demand and market structures, describe how health insurance affects both consumer and producer decidions give examples.
1. Describe 5 activities that the state government performs for health care. 2. Describe the role of the local health department in the health care system and give examples of local health department healthcare activities?
Consider the below market supply and demand curve a)The government imposes a price ceiling of £0.2 in the market for lemons. Define price ceiling and describe the impact of a £0.2 price ceiling on the market for lemons b.Discuss the reasons why governments sometimes choose to control prices. Market's Supply Price Market Demand Quantity Price Quantity C) 0.1 0.2 0.3 0.4 0.5 0 Infinity 0.1 0.2 0.3 0.4 0.5 C) 30 10) 17 20 25 17
The following supply and demand functions describe the competitive market Q2+4P Q40-2P where Q and Q" are the quantities supplied and demanded, and P is the market price. (a) What are the equilibrium price, P, and quantity, Q"? (b) Compute the producer and consumer surplus that results from the market equilibrium in (a). Hint: To solve this problem, try drawing a graph of this market. Then recall the definitions from class: CS is the area under the demand curve and...
6. Demand, Supply, consumer surplus and Market Equilibrium. The following relations describe monthly demand and supply conditions in the metropolitan area for recyclable aluminum QD = 317,500 - 10,000P (Demand) Qs = -2,500 + 10,000P (Supply) where Q is quantity measured in pounds of scrap aluminum and P is price in dollars. Complete the following table: A Calculate the market equilibrium price and output? B. What is the inverse demand curve P = f(QD)? C. Compute the consumer surplus at...
Use the Supply and Demand analysis for blueberry muffins market. Describe what would be the impact of the following two events (at the same time) on market outcomes. A decrease in the price of blueberries AND a decrease in the price of strawberries muffins.
The graph below shows demand and supply in the market for airline tickets. The government decides to introduce an excise (or commodity) tax that pushes up the price for consumers from Pe to Pc and decrease quantity supplied from Qe to Q1 .Use the labeling below to identify the areas that match the terms indicated. Note that you may place each letter multiple times, and that some answers will require moving more than one letter into the bin to identify...
Can someone please explain C. Role of Government 1. Draw a supply and demand graph with a binding price ceiling. Label consumer and producer surplus as well as deadweight loss 2. Who benefits from the imposition of the price ceiling 3. T/F/Explain The current price for your favorite candy is $3. Government imposes a sales tax on this product of $0.50. The new equilibrium price will be $3.50 4. In the graph below, what is the customer's burden of the...
Suppose we are analyzing the global market for ideas. Use the demand-supply framework to describe the demand and supply of ideas. List some shift factors that have impacts on demand and supply of ideas.