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What is it?
A free market is a market where the price of a good or service is determined by supply and demand,
rather than by governmental regulation

Market forces - for: signalling, incentive and rationing functions of price can lead to an efficient
allocation of resources

The government may…

Page 2

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in R&D means that in the long term, they could technologically innervate, passing on
those benefits to the consumer. Therefore, it may reduce consumer welfare instead.
E.g. Microsoft

Regulation- Price controls & minimum wage in order to ensure workers or consumers
are not exploited.
However, free market economists argue that…

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