The reasons for a potentially beneficial role of government intervention.

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Answer 1

Question

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

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Students have asked these similar questions

Is market failure either necessary or sufficient for government intervention?

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Answer 2

Question

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

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Answer 3

Question

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

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Answer 4

Question

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

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Answer 5

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

Answer 6

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.

Economics Concept Introduction

Inefficiency: Inefficiency implies an economic efficiency that fails to allocate resources optimally to each individual in the economy.

Answer 7

Chapter 8, Problem 1QE

To determine

The reasons for a potentially beneficial role of government intervention.

Answer 8

Expert Solution & Answer

Explanation of Solution

The government can intervene into the market to solve the problem of inefficiency in allocation of resources. When the economy experiences depression, low economic activity, market failure, imperfect information, and externality, the government enters into action. That is, the government introduces new policies and rules to solve these issues. Thus, the government will intervene in order to stabilize the economy.