Government involvement really changes how much stuff people buy and sell. Here are some ways this happens:
Subsidies: In the UK, the government spent £500 million to help support renewable energy. This helps lower the costs for companies making green energy, so they can produce more.
Taxes: The UK also introduced a £2 tax on sugary drinks. This was done to help people drink less soda, which impacts how much soda people want to buy.
Price Controls: In London, there are rules about how much rent can be charged, known as rent controls. Because of these rules, there are 20% fewer places to rent, but more people want to rent them.
Regulations: Sometimes, the government makes rules to protect the environment. These rules can make it harder for companies to supply certain products, but at the same time, they create a need for eco-friendly technologies.
These examples show how government actions can change the balance between what people want to buy and what is available in the market.
Government involvement really changes how much stuff people buy and sell. Here are some ways this happens:
Subsidies: In the UK, the government spent £500 million to help support renewable energy. This helps lower the costs for companies making green energy, so they can produce more.
Taxes: The UK also introduced a £2 tax on sugary drinks. This was done to help people drink less soda, which impacts how much soda people want to buy.
Price Controls: In London, there are rules about how much rent can be charged, known as rent controls. Because of these rules, there are 20% fewer places to rent, but more people want to rent them.
Regulations: Sometimes, the government makes rules to protect the environment. These rules can make it harder for companies to supply certain products, but at the same time, they create a need for eco-friendly technologies.
These examples show how government actions can change the balance between what people want to buy and what is available in the market.