Economics - Chapter 8
- Created by: sammilaw
- Created on: 04-04-15 13:28
View mindmap
- Market Failures
- Chapter 8
- Partial market failure
- Where the free market provides a product but with misallocation of resources
- Complete market failure
- Where the free market fails to provide a product at all i.e. public goods
- Benefits of a monopoly
- Research and development spending
- Exploitation of economies of scale
- International competitiveness
- Forms of market failures:
- Negative externalities
- Positive externalities
- Immobility of factors of production
- Equity issues
- Monopolies
- Public goods
- Imperfect information
- Negative Externalities
- Tax
- Overproduction or overconsumption
- MSC = MPC + MEC
- Positive Externalities
- Subsidies
- Underproduction or underconsumption
- MSB = MPB + MEB
Comments
No comments have yet been made