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Chapter 4: Working with supply and demand, Fight means prevent the price…
Chapter 4: Working with supply and demand
Government intervetion in markets
Have polices where tries to
fight
the market
Force the market price to adjust
Intervine to change market outcome
Subsidy
A government payment to buyers or sellers on each unit purchased or sold
Price Floors
Price floor
A government-imposed
minimum price in a market.
Surplus
An excess supply not eliminated by a fall in price, so that quantity supplied continues to exceed quantity demanded.
Excise tax
A tax on a specific
good or service.
The
incidence of a tax
(the distribution of the burden between buyers and sellers) is the same whether the tax is collected from buyers or sellers
Tax incidence
The division of a tax payment between buyers and sellers, determined by comparing the new (after tax) and old (pretax) market equilibrium : :
The
incidence of a tax
that is collected from buyers falls on both sides of the market. Buyers pay more, and sellers receive less, for each unit sold.
Supply and Demand in Housing Markets
Is a versatile tool. With a bit of modification, we can use it to analyze almost any market in which something is traded at a price, including markets for labor, foreign currencies, stocks, bonds and more.
Stock variable
A variable representing a quantity at a moment intime
Flow variable
A variable representing a process that takes place over some time period
Fight means prevent the price from reaching its equilibrium value
Fight polices
Price Floors
Price Cellings
A government payment to buyers or sellers on each unit purch :red_cross:
: