Think of two things that are provided free of charge. In each case, identify whether and in what form a shortage might occur. In what ways are/could these shortages be dealt with? Are they the best solution to the shortages?
Answer to relevant QuestionsIf the government increases the tax on a liter of petrol by 5p, what will determine the amount by which the price of petrol will go up as a result of this tax increase?Do rising world food prices make the CAP unnecessary?Taking the same industries, identify as many economies of scale as you can.Think of three examples of monopolies (local or national) and consider how contestable their markets are.‘A firm will always prefer to make more profit rather than less.’ Do you agree with this statement? Is it compatible with alternatives to the profit-maximizingtheory of the firm?
Post your question