Theme 3.6.2: the impact of gov intervention Flashcards
1
Q
what does gov intervention have an impact on?
A
prices
profit
efficiency
quality
choice
2
Q
impact on prices
A
consumers pay fair prices as gov intervention aims to prevent monopolies charging excessive prices
3
Q
impact on profit
A
profits are limited
4
Q
impact on efficiency
A
should increase due to increase in competition
dynamic efficiency should increase due to encouragement of investment
if costs are pushed too far up then efficiency can reduce
5
Q
impact on choice
A
likely to offer less choice,only one company producing the good
