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Reasons for government interventing the economy
The government intervenes the market to correct serious market failures. A market is defined as an organisation that allows buyers and sellers to exchange goods or services. A market should be able to allocate the resources efficiently with competition in both sellers and consumers and consists of choices and quality. It should maximise the satisfactions of both consumers and sellers. But markets may create inequality of opportunity, which the disadvantaged groups are usually lack of skills to work and knowledge and promotes inequality of income. A market may also provide collective goods…
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