Top answers

Do subsidies to producers always correct market failure? As an essay style question.

Level 1 - definitions of subsidies and highlight what is the market failure (in this case underconsumption of merit goods / positive externalities) and a short answer to the question also lay out how the ess...
AT
3235 Views

What are positive externalities of consumption? Explain with a diagram and give an example.

Externalities are effects that occur, due to a transaction, on third parties (people who were not involved in the original transaction). Hence, positive externalities of consumption are produced when the con...
JC
Answered by Joseph C. • Economics tutor
15298 Views

Explain what is meant by the term "perfect competition"

Perfect competiton in a market is defined as being a set of conditions where markets have little to no entry or exit barriers. These may be natural or synthetic. An example of a natural barrier to entry is h...
LE
Answered by Lucas E. • Economics tutor
2480 Views

How do you decide whether to change a point on demand curve or to shift the whole curve?

Changes in price mean a shift along the curve, changes other than the price of a good (e.g. change in price of a substitute good) shift the demand curve.
MJ
Answered by Mahnoor J. • Economics tutor
2147 Views

What is opportunity cost?

Economics is all about making choices. These choices are ruled by scarcity, which is the theory that there are finite resources at our disposable. Because of scarcity, we cannot have everything we want. Ther...
ER
Answered by Edward R. • Economics tutor
3387 Views