Analysis of Competitive Markets

A price ceiling is a regulation that sets the maximum price that can be charged for a product. This is done by the government to keep essential goods …

When demand and supply are elastic, the quantity demanded and supplied respond significantly to price changes. In this context, a price ceiling set below …

In a market with inelastic demand and supply, the quantity demanded and supplied exhibits minimal responsiveness to price fluctuations. So, when prices …

A price floor is a regulation that establishes the minimum price that can be charged for a product. Governments often set price floors to ensure producers …

Taxes are mandatory financial charges that governments impose on individuals or businesses. An excise tax, in particular, is levied on the sale of …

Consider a small shop selling handmade pottery. The government imposes a small tax percentage on it, increasing its price. Consumers still purchase the …

Certain goods have an inelastic demand, meaning that with the change in price, the quantity demanded changes very little. Assume the demand for rice is …

Certain goods have an elastic demand, meaning the quantity demanded changes significantly in response to price changes. Luxury cars are an example of such …

A quota is a regulation that sets a certain quantity of a good or service to be provided. It can either mandate a minimum production level for firms or …

A tariff is a tax that a government imposes on imported goods. It increases the cost of imported goods, making them less competitive than domestically …

A subsidy is a financial aid to an economic sector by the government to promote greater production of a good or service. Subsidies reduce the cost of …