Market Failure
Muhtasari
Everything you have learned so far describes a market that works. Prices rise where goods are wanted, resources follow the prices, and nobody had to be told what to do. This lesson is about the cases where that machinery gets the answer wrong: where the market produces too much of something harmful, or too little of something valuable, and keeps doing so however long it is left alone.
You will learn what economists mean by market failure, why the phrase is about a misallocation of resources rather than about anyone going bankrupt, and how to separate a private cost from a social cost. You will meet externalities, the effects that spill over onto people who were never part of the transaction, in both their negative and positive forms. And you will work through what a government can actually do about it, which is the question the specimen paper devoted its entire second section to.
Malengo
- The meaning of market failure as misallocation of resources
- Implications of misallocation of resources
- Government intervention
- Externalities
- Defining externalities
- The difference between positive and negative externalities
Ramani ya mawazo
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Maelezo ya Somo
Dokezo Kamili la Somo Linapatikana kwenye Programu ya Green Bridge
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Tathmini ya Somo
Hongera kwa kukamilisha somo la Market Failure. Sasa kwa kuwa umechunguza dhana na mawazo muhimu, ni wakati wa kuweka ujuzi wako kwa mtihani. Sehemu hii inatoa mazoezi mbalimbali maswali yaliyoundwa ili kuimarisha uelewaji wako na kukusaidia kupima ufahamu wako wa nyenzo.
Utakutana na mchanganyiko wa aina mbalimbali za maswali, ikiwemo maswali ya kuchagua jibu sahihi, maswali ya majibu mafupi, na maswali ya insha. Kila swali limebuniwa kwa umakini ili kupima vipengele tofauti vya maarifa yako na ujuzi wa kufikiri kwa makini.
Tumia sehemu hii ya tathmini kama fursa ya kuimarisha uelewa wako wa mada na kubaini maeneo yoyote ambapo unaweza kuhitaji kusoma zaidi. Usikatishwe tamaa na changamoto zozote utakazokutana nazo; badala yake, zitazame kama fursa za kukua na kuboresha.
- Which of the following is an example of a negative externality? A. A firm creates pollution in the production process B. A firm makes a loss and closes down C. A firm pays its workers a low wage D. A firm raises the price of its product Answer: A
- Which statement correctly describes a positive externality? A. Private benefit is greater than social benefit B. Private cost is greater than social cost C. Social benefit is greater than private benefit D. Social cost is greater than social benefit Answer: C
- Consumption of healthy food creates positive externalities. Which policy is the most appropriate government response? A. A ban on healthy food advertising B. A subsidy for producers of healthy food C. An indirect tax on healthy food D. A tradable permit scheme for healthy food Answer: B
- A firm's private cost of production is $60 per unit and the external cost is $18 per unit. What is the social cost per unit? A. $18 B. $42 C. $60 D. $78 Answer: D
- Market failure is best described as which of the following? A. A business becoming bankrupt B. A misallocation of resources by the market C. A temporary shortage of a good D. Consumers being unable to afford a product Answer: B
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Vitabu Vinavyopendekezwa
Fanya Mazoezi ya Maswali ya Majaribio
Ungependa kufanya mazoezi ya maswali ya majaribio kuhusu Market Failure? Pakua programu ya Green Bridge CBT ili kupata maswali ya majaribio na tathmini kamili za mazoezi kuhusu mada hii.
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