Cards (34)

    • Subsidies can lead to market distortions by creating artificial demand.
    • Regulation refers to the enforcement of rules by governments to control market activities
    • Match the type of regulation with its example:
      Economic regulation ↔️ Utility price controls
      Social regulation ↔️ Food safety standards
      Environmental regulation ↔️ Emission standards
    • Order the effects of regulation on businesses:
      1️⃣ Increases business costs
      2️⃣ May stifle innovation
      3️⃣ Requires effective enforcement
    • Regulation can stifle innovation by increasing compliance costs for businesses.
    • Regulation always leads to higher prices for consumers.
      False
    • What is a price ceiling and its purpose?
      Maximum price below equilibrium ||| Ensure affordability
    • Price controls are government-imposed limits on the prices that can be charged for goods and services in a market
    • A price ceiling can lead to shortages because quantity demanded exceeds quantity supplied.
    • A price floor can lead to surpluses because quantity supplied exceeds quantity demanded.
    • Taxes are mandatory payments levied by the government on individuals and businesses to finance public goods and services
    • A price floor is set above the market equilibrium.
    • A price ceiling is a maximum price set below market equilibrium
    • What is a price floor designed to protect?
      Producers
    • Match the price control with its effects:
      Price Ceiling ↔️ Shortages, rationing
      Price Floor ↔️ Surpluses, inefficiency
    • Rent control is an example of a price ceiling
    • What are taxes used for by governments?
      Funding public services
    • Direct taxes are levied on goods and services.
      False
    • Indirect taxes are collected by retailers
    • What is the formula for calculating the amount of tax?
      Tax=Tax =PricetaxPricenotax Price_{tax} - Price_{no tax}
    • Match the type of tax with its example:
      Direct Tax ↔️ Income tax
      Indirect Tax ↔️ Sales tax
    • What is the purpose of subsidies provided by the government?
      Encourage production or consumption
    • Subsidies aim to lower prices for essential goods and services
    • Subsidies can lead to market distortions.
    • What is the mathematical formula for calculating the price after a subsidy?
      Price_{after subsidy} = Price_{original} - Subsidy Amount</latex>
    • Regulation refers to the enforcement of rules by governments
    • What is one purpose of government regulation in markets?
      Protect consumers
    • Match the type of regulation with its example:
      Economic Regulation ↔️ Utility price controls
      Social Regulation ↔️ Food safety standards
      Environmental Regulation ↔️ Emission standards
    • How does regulation on carbon emissions affect the cost of production for businesses?
      Pafter=P_{after} =Pbefore+ P_{before} +C C
    • State provision ensures universal access to essential goods and services regardless of income.
    • What is nationalization and its primary aim?
      Government takeover for public benefit
    • Privatization seeks enhanced efficiency and market responsiveness
    • Match the ownership type with its characteristic:
      Nationalization ↔️ Government ownership
      Privatization ↔️ Private ownership
    • What is the formula for calculating the value of a nationalized asset?
      AssetValue=Asset Value =CashFlows÷DiscountRate Cash Flows \div Discount Rate
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