Nationalisation Flashcards
1
Q
What is nationalisation?
A
when the private sector transfers ownership of a private sector firm to the government
2
Q
Where are prices usually set?
A
where AR = MC
allocatively efficient to maximise welfare
3
Q
How is the firm able to continue despite making big losses?
A
losses paid for with taxpayers money
4
Q
Why are firms usually nationalised?
A
to reduce negative externalities and the exploitation of consumers
