Mixed economic system
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9 Terms
1
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what happens in a mixed economy
resources are allocated based on both price mechanism and government decisions
2
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what factors influence firms on the prices of their products
subsides and taxes
3
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what impacts the effect of a subsidy for a business
the size of it and its PED
4
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what other policies can influence private sector firms
* industrial
* competition
* environmental
* competition
* environmental
5
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How are maximum prices set
below the equilibrium price
6
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How are minimum prices set
above the equilibrium price
7
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how can regulations be ineffective
* they can be expensive to implement as punishing people takes a lot of money
* there effectiveness depends on how well people follow them
* there effectiveness depends on how well people follow them
8
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what can governments do to help economies
* correct market failure
* protect vulnerable groups
* ensure even distribution of income and wealth
* protect vulnerable groups
* ensure even distribution of income and wealth
9
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what is an advantage and disadvantage of having a private sector investment project
* it ensures efficiency
* but it will only consider private costs and benefits
* but it will only consider private costs and benefits