Government Policies

Concepts

  • Price Controls
    • Price Ceilings
    • Price Floors
    • Impact on Consumer/Producer Surplus
    • Deadweight Loss
  • Excise Taxes
  • Subsidies
  • Tariffs
  • Quotas
  • How These Policies Affect the Market Price and Quantity

Overview

There are times when the government feels compelled to intervene in a particular market.  One way is through the use of tariffs and quotas.  Tariffs and quotas deal with international markets.  A tariff is a tax on imports and a quota is a cap on imports.  Either way, the government is making it more difficult for businesses to get their product to market, and thus the supply goes down.  Taxes and subsidies deal with domestic markets.  Taxes take money away from businesses and subsidies give free money to businesses.  Taxes make it more difficult for businesses while subsidies make it easier for businesses.  The last topic is price controls.  The government implements price controls if the don’t like the price established by the market.  If the government believes the price is too high, they will implement a price ceiling to force the price lower.  If they feel the price is too low, they will implement a price floor to force the price higher.  We learn to observe the impact of these price controls on the consumer/producer surplus along with the deadweight loss that gets created whenever price controls are implemented.

Materials

Lecture

Price Controls Video

 

Per-Unit Subsidy Video

 

Tariffs and Quotas – Effects on Imported Goods and Domestic Prices

 

Trade Policy – Tariffs and Quotas

 

Government Policies 1 Lecture

 

Government Policies 2 Lecture

 

Quiz

Reminders Before Taking Quiz:

  • When you are asked “What Period?” please only put the one digit number of your class period. For example, if you have this class 1st period, just put 1 in the box for your response.
  • The password to login is CASE SENSITIVE, so please be conscious of this as you type in your password.
  • If it appears to be timing out when you login, try the following troubleshooting steps:
    1. Restart your phone (hard shut down and turn it back on)
    2. Turn off WiFi (access quiz through your data carrier)
    3. Click the “Classroom Link” provided in the initial email. Login, and then select this quiz from the list.

CLICK HERE TO TAKE QUIZ

Comments are closed.