Misalocation of Resources Flashcards
1
Q
What is a misalocation of resources a result of
A
market failure not distributing efficiently
2
Q
What is an example of a misalocation
A
traffic congestion
3
Q
What are the consequences (5)
A
costs to society and general pop
Decrease quality of life
Inequality
reduced efficiency
reduced competitiveness
4
Q
How do the government try to intervene (5)
A
Indirect taces
Subsidies
Max/min prices - cigarettes
Regulation
Provision
