Chapter Preview: In Chapter 2, we discovered how markets achieve equilibrium and how they respond to changes in demand and supply conditions. Although many economists feel that market forces should be permitted to determine the economy’s output mix and price structure, very few would assert that no intervention in markets is ever justified. In this chapter, we learn more about how and why markets are controlled and some of the consequences of such controls. We also look more closely at why economists feel so strongly that, left to their own devices, markets generally do a good job of allocating the economy’s scarce resources to best meet our unlimited wants.
By the end of this chapter, you will be able to:
- Distinguish ...
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