If a maximum price is set above equilibrium there will be:
A price fall
A price increase
Excess supply
Excess demand
It is necessary to ration a good whenever
A surplus demand
Supply exceeds demand
Demand exceeds supply
There is a perfectly inelastic demand for the good
In a free market system rationing occurs when there are increase in
Demand
Supply
Price
Quantity
With a positive externalitly
There is under consumption in the free market
There is over consumption is the free market
The government may tax to decrease production
Society could be made off less was produced.
Economist say that there has to be some form of rationing whenever
Merit goods are produced
Inflation occurs
There are externalities
There is excess demand
A public good
Is provided by the government
Is free
Has the properties of being non executable and non diminishable
Has external cost
An example of an indirect tax is
Income tax
VAT
A tax of profits
Inheritance tax
Nationalization occurs when:
The government sells assets to the private sector
The government bans a product
The government takes ownership of a business
The government taxes a product to raise its price
VAT is a good example of which kind of tax?
Direct
Ad valorem
Specific
Excise duty
If the price in a market is fixed by the government above equilibrium.
There is excess equilibrium
There is excess supply
There is equilibrium
