Description
Make sure to apply Saint Leo’s Core Values to your analysis, remembering that responsible stewardship calls on us to be ‘resourceful’. You should cite specific examples and applications, and take a clear stand on whether you believe the actions of government work towards resolving market failures or not.
This assignment must be a 2-3 page Word Document and use 12 pt. Times New Roman font with proper APA citations. Be sure to review the scoring rubric here.
Explanation & Answer
Attached.
Correction of Market Failures-outline
A. Market failure is a situation where there is an insufficient distribution of goods and
services within the free market which results in a loss in social welfare
B. The government has the role of controlling the monopoly power
C. A second role of the government in the correction of market failures is public goods.
D. A third role of the government is on externalities
E. On a case where the market failure has occurred as a result of demerits goods, there
are ways in which the government will respond
F. The government may control this type of market failure by imposing massive taxes
on these goods
G. The government may correct the market failure by intervening in various macroeconomic factors
H. It should act to minimize the damages brought by economic events that occur
naturally
I.
Running head: CORRECTION OF MARKET FAILURES
Correction of Market Failures
Name
Institution
1
CORRECTION OF MARKET FAILURES
2
Correction of Market Failures
Market failure is a situation where there is an insufficient distribution of goods and
services within the free market which results in a loss in social welfare. Market failures may be
corrected using government-imposed solutions, private market or through voluntary collective
actions. The various roles of the government while correcting the market failures are discussed.
The government has the role of controlling the monopoly power. The government ...
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