Eco 201 government tools - Study guides, Class notes & Summaries

The Government has various tools available to deal with the Market Failure, the few of the tools available to the Government Price Profit Regulations • Restrictive Trade policy and practices • Direct Controls or Regulations • Patents and Law of Tort • Subsidy Policy • Tax Policy • Foreign Exchange Policy. Briefly provide your views on all the above to predominantly sustain for an Economy in Market forces.

4 2 Simulation ECO 201 Module Four Simulation Checkpoint Assignment ECO 201 Government Tools: Discuss tools available to the government to correct a market failure. Provide examples from the textbook. ï‚·Command and control policies: This the act of an externality by requiring or forbidding certain behaviors. For instance, there are bans on cutting down trees. ï‚·Corrective taxes and subsidies: The government uses this tool by taxing activities that have negative externalities an...

What type of framework created would constitute investment spending? How would that help with future consumption? What are MPC and MPS and why are they important to the effectiveness of government investment? What factors impact the effectiveness of government investment other than the money? Principles of Macroeconomics ECO-201-OL03