Question

What are the economic problems in news article that require government intervention

Answer 1

w exchange rat volatilit The fundamental economic problem is the issue ou scarcity but unlimited want scurcily implies there is only a limited quantity of resources eg. tirile fossil fuel. Becawe 05 Scarcily there is a constant oppostyniry cust. ib you we resources to (on JUNG one goodl, you cannot consume another. The cocool an tecture 06 economics is concemed with eleciling how to allocate resources in society to make The most elbicient and day We of resources. The main produce ? produce? for whom to produce! underlying issues are What to How to eig.ob economic problems How to deal with external costs / Pollution es. pollcetion from production. How to redistribute income to reduce poverty, without cawing loss of economic incentives. How to provide pieblic goods, which are not esually provided in a free macket. economic welfare! maioeconomic problem, -How should we mecu ure problem of extemalities Denviarn mental issues, 11) monopoly 11) Inequality / povesty 1.) Volatile price. V) Irational behaviour 1) recession 11) Inflation "1) Balance of payments

montany policy is whaly managed by the central banta, though goreon meats hare oversight and my set an inflation 2 To solve economic problem government have lots of solutions. It provides different type of economic policie. s monetary policy. 11) Fiscul policy In supply-side policie iv) micro economic policier taxi subsidiel, price controls, howing market, regulation of monopolie u) labour market policies "1) Tuεito trade policia - 1) Risicel policy. Gorenment changes to taxation and spending lerce to influence agreegate demand. gort-caim is to increase agregare demand in a depressed economy. Alloreduce inficetonary preclure or reduce te budget deficit. 1) monetang policy. turget. 11) Exchange rate policy. in policies for financial stabilis. i-e. Roone ratios lender of last secst. ") trade policy - A gort trade policy may be to seek. face trade deals and the reduction of turibas