Micro - Government intervention in markets ✔️ Flashcards
1
Q
What is Indirect Taxation
A
The taxation of goods and services rather than on income or profit
2
Q
What is a Subsidy
A
A amount of money granted by the government or public body to help an industry or business keep the price of a commodity or service low.
3
Q
What are Minimum and Maximum prices
A
Price ceilings and floors used to interfere in markets which are failing to allocate resources efficiently.
4
Q
Methods of Government Intervention in markets
A
- indirect tax
-subsidies - maximum & minimum pricing
- trade pollution permits
- state provision of public goods
- provision of information
5
Q
State Provision of Public Goods
A
The government providing public goods which are under provided in the free market. E.g. education & healthcare.
6
Q
Provision of Information
A
Actions aimed at creating asymmetric information, allowing consumers to make more informed decisions.
