When market participants are allowed through their interactions to find the price, there will be equilibrium...

When market participants are allowed through their interactions to find the price, there will be equilibrium where the quantity supplied by buyers equals the quantity supplied by sellers. If this is the case, why might the government intervene in certain markets where externalities exist? Please give reasoning for both a positive and a negative externality. Why might the government intervene in the case where the good is a public good?

Expert Solution

Rahul Sunny answered 7 months ago

What mechanisms allocate resources when the price of a good is not allowed to bring supply and demand into equilibrium?

Please answer the following question in details. Specific subject: MICROECONOMICSWhat mechanisms allocate resources when the price of a good is not allowed to bring supply and demand into equilibrium?

1.In market equilibrium, when the price of complement in production decreases, the price in the new...

1.In market equilibrium, when the price of complement in production decreases, the price in the new equilibrium point will be........................ 2. In market equilibrium, when the price of complement decreases, the new equilibrium quantity will be ……….…… 3.

a) Discuss the effects on the equilibrium price and quantity in the software market, when the...

a) Discuss the effects on the equilibrium price and quantity in the software market, when the price of computer hardware falls. (Please write down the discussion and also show the effects in diagrams.) b) Discuss the effects on the equilibrium price and quantity in the hardware market, when the price of computer software rises. (Please write down the discussion and also show the effects in diagrams.)

Explain Market equilibrium, equilibrium price, and equilibrium quantity

when the market is in equilibrium

9. Find the equations for Demand and Supply, and determine the market equilibrium price and quantity....

9. Find the equations for Demand and Supply, and determine the market equilibrium price and quantity. (P is the y variable, and the QS and QD are x variables). • Demand equation: P = _______________________ • Supply equation: P = ________________________ • Market equilibrium price: ______________ • Market equilibrium quantity: ___________ P QS QD 400 1600 3000 450 1800 2500 500 2000 2000 550 2200 1500 600 2400 1000 • Find the numerical value of price elasticity of demand...

i. Find the equilibrium price and quantity in the market for steel whose supply and demand...

i. Find the equilibrium price and quantity in the market for steel whose supply and demand curves are given by P=4QS and P = 12 – 2QD respectively. ii. If the price charged on the market is $6, how does the market get back to equilibrium, ceterus parabus. iii. Wages go up significantly so that the cost of production increases. Which of the following would be true in the short run: The demand curve would shift out or to the...

distinguish when price May or may not allowed

When a shortage exists in the market, the price is below equilibrium. Consequently, buyers are willing...

When a shortage exists in the market, the price is below equilibrium. Consequently, buyers are willing to buy more than sellers are willing to sell at that price. If demand and supply curves do not move, more will be sold only if the price increases. Select one: True False Question text If Betty experiences a decrease in pay, we would expect Betty’s demand for inferior goods to increase. Select one: True False A decrease in supply causes price to rise,...

when the government imposes a price ceiling below the equilibrium market producer surplus ______ and total...

when the government imposes a price ceiling below the equilibrium market producer surplus ______ and total surplus _______ A) will stay the same; will stay the same b) will fall;will fall c)will rise; will rise d)will rise; will stay the same

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