Question 1 (750-1000 words) Since the recent Great Recession of 2007-2009, there has been increasing disillusionment...

Question 1 (750-1000 words)
Since the recent Great Recession of 2007-2009, there has been increasing
disillusionment with the free market system. Briefly define “free market system” and
identify and describe at least three of its major concepts or attributes. Then, critically
analyze the view that the free market system is the best and only realistic alternative for
determining the allocation of resources in an economy. Provide evidence to support
your analysis.

Solutions

Expert Solution

Free market system-" A free market is a system in which the prices for goods and services are all self- regulated by the open market and by consumers.

Attributes

1 private ownership of resources- free economies exist because a significant portion of resources are owned by individuals or companies in the private sector and not a central government agency.

2 thriving financial markets- Banks and brokerages exist so that they give individual and companies the means to exchange goods and services, and to provide investment services. The financial institutions then make a profit by charging interest or fees on transactions.

3 freedom to participate- another characteristic of a free market system is that anyone individual can take part in it.

The free market system ensures that the most desired goods and services are produced. This means that what to produce is determined consumers, how to produce is determined by producers. This is the best way for allocation of resources. Free market system is best for transparency.for example if there is no free market and a chocolate for 5 rupee than absolutely government is in mediator form and there is no transparency between the producer and consumer. That's why free market system is the best and only realistic alternative for determining the allocation of resources is an economy.

Rahul Sunny answered 2 months ago

Next > < Previous

Related Solutions

What is the Bank Regulations during 2007-2009 ( Great Recession ) ?

What is the Bank Regulations during 2007-2009 ( Great Recession ) ?GIVE DEFINITIONS ABOUT ALL OF THESE TERMS:TARP; HERA; Federal Housing Finance; Regulatory Reform Act of 2008; HOPE for homeowners act of 2008; SAFE Secure and Fair Enforcement for Mortgage Licesing Act of 2008; Forecosure Prevention Act of 2008 and FHA Modernization 2008; Emergency Economic Stabilization Act of 2008; Helping Families Ave Their Homes Act of 2008.

What was the similarities and difference between the great depression and the great recession 2007-2009?

Please do it by type not pics. 1.The Great Recession (2007 to 2009) changed the nature...

Please do it by type not pics. 1.The Great Recession (2007 to 2009) changed the nature and direction of the macroeconomic debate because: a.the financial crisis threatened to collapse the entire economy, an outcome not predicted by classical models. b.the prior direction of the macroeconomic debate was on the New Classical and Real Business Cycle models. c.the technology boom of the 1990s seemed to validate the Real Business Cycle model. d.of all of the answers in this question. e.the recession...

11) (≈ 21 ???) The 2007-08 Financial Panic and The Great Recession 2007-2009: Declines inwealth due...

11) (≈ 21 ???) The 2007-08 Financial Panic and The Great Recession 2007-2009: Declines inwealth due to the fall in housing prices decreased “autonomous consumption”. In addition the financial crisis (bank runs) induced banks to decrease lending which decreased investment spending. a) Draw the Multiplier Model graph and indicate on your graph which way the Aggregate Demand (AD) curve shifts and what happens to equilibrium Real GDP due to declines in both autonomous consumption and investment. Be sure to label...

The financial crisis of 2007–2009 was the most severe one since the Great Depression of the...

The financial crisis of 2007–2009 was the most severe one since the Great Depression of the 1930s. What were the main causes of the 2007–2009 financial crisis other than the housing market collapse? What were its impacts on the U.S. financial institutions and markets? If you were an economic policy decision maker, what could you have done better to resolve the financial crisis during that period.

The Financial Crisis of 2007 – 2009 was the worst economic downturn since the Great Depression...

The Financial Crisis of 2007 – 2009 was the worst economic downturn since the Great Depression of the 1930’s, and like that event had global repercussions and consequences. Also like the earlier crisis there were significant events that were under the control of policy makers that made the 2008 crisis worse, among these were lax banking regulations on home loans, a loosening of regulations that had prevented commercial banks from engaging in speculative behavior more typically reserved for investment banks...

TOPIC: Achieving monetary policy goals and the Great Recession of 2007-2009. A) What are the Federal...

TOPIC: Achieving monetary policy goals and the Great Recession of 2007-2009. A) What are the Federal Reserve's established economic goals? B) What are the policy tools that the Fed directly controls? What are the policy instruments and intermediate targets? C) What were the contributing factors to the Great Recession of 2007-2009? D) What were the unconventional monetary measures that the Fed used to combat the recession? E) How did international policy coordination help keep the Great Recession from becoming an...

During the great recession of 2007-2009, did the US government take a page of the Keynesian...

During the great recession of 2007-2009, did the US government take a page of the Keynesian macro theory to help move the country out of recession? What did they create? Did it work?

Why did the USA have a great recession during 2007 to 2009 period? Was it cause...

Why did the USA have a great recession during 2007 to 2009 period? Was it cause by the financial crisis? Briefly explain. You may use parts of your research paper to answer the question.

The recent Great Recession of 2008-2009 has had significant impact on a wide range of corporate...

The recent Great Recession of 2008-2009 has had significant impact on a wide range of corporate performance. What impact would you predict it had on leverage? Would financial leverage have increased, decreased, or remained the same? What about operating leverage? Why? please elaborate and explain

Subjects