Macroeconomics_Unit1_DB

Macroeconomics_Unit1_DB - and the supply Distinguish...

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Question: Proponents of free market systems argue that free enterprise leads to more efficient production and better response to changing consumer preferences. Others point to the fact that markets are not perfect. Consider both viewpoints and respond to both sides of the issue with your viewpoints. Answer from teacher: …………………………………………………………………………………………… Distinguish between a market that yields efficient outcomes and markets that yield unfair outcomes. A good discussion involves understanding that efficiency does not imply or mean that the market outcome is "fair or equitable." "Socialism—defined as a centrally planned economy in which the government controls all means of production—was the tragic failure of the twentieth century" (Robert Heilbroner) Keep in mind that even in a market system, the government could act and alter the factors that determine the demand
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Unformatted text preview: and the supply. Distinguish between the government acting using laws that affect market for final goods and acting using laws that affect market for resources. Taxes are an essential method that the government regulates and controls the demand and supply. The existence of demand and supply does not mean that the market is "free from regulation". An appropriate response would be describe how a free market promotes efficiency or how a market can become imperfect. There should be a discussion on how regulation harms free markets or how free markets can harm the community. Score : Response to free markets are efficient 15 / 15 points Response to market are not perfect 10 / 10 points Comments 10 / 10 points Composition 10 / 10 points APA format 5 / 5 points Robert Heilbroner., "Som" in Concise Encyclopedia of Economics, taken from http://www.econlib.org/library/Enc/Som.html...
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