Government failure
- Created by: Chantallehelm
- Created on: 20-12-12 15:03
Other questions in this quiz
2. What may huge increases in prices of cigarettes lead to?
- Criminals purchasing cigarettes abroad and selling them on the black market
- Complete smoking bans
- Less pollution
3. Four reasons why governments may fail
- Inadequate information, conflicting objectives, administrative costs, market distortions
- Conflicting objectives, lack of subsidies, over taxation, restriction on output
- Restriction on output, too much regulation, conflicting objectives, large gap between rich and poor
4. What does government failure refer to?
- High taxes
- When government intervention in the market leads to a loss rather than a gain in economic welfare
- Market distortion
5. What may the minimum wage lead to?
- High unemployment
- Excessive private costs
- Increased output
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