micro real world examples

Question 1

give an example on UK negative externality policy

Answer 1

Uk plastic bag charge - charge 10p per bag

Question 2

by how much did the plastic bag charge reduce usage?

Answer 2

over 90%

Question 3

give an example of positve externality policy

Answer 3

covid vaccines - reduced spread of transmission

over 90% of adults recieved a dose

Question 4

give an example of a price ceiling

Answer 4

Ofgem energy price cap of £2,500

protects consumers but reduced SNP

Question 5

give an example of a price floor

Answer 5

Uk NMW of £11.44 for workers over 21+

Question 6

give an example of an indirect tax

also negative externality

Answer 6

Sugar drinks tax - firms reformulated drinks and also reduced consumption by 50%

Question 7

give an example of a market failure (information provision)

Answer 7

overconsumption of cigarettes resulted in health warnings on packaging

Question 8

Give an example of monopoly power

Answer 8

google owns 90% of the search market

monopoly pricing + failure to regulate

Question 9

give an example of competition policy

Answer 9

CMA restricted Asda and Sainsburys merger to prevent M power

Question 10

give an example of privatisation

Answer 10

British telecom privatisation 1984

increased competition + efficiency

Question 11

what is the UK income gini coefficient?

Answer 11

0.36 - high inequality, failure to redistribute

Question 12

give one example of govt failure

Answer 12

2019 price cap by ofgem reduced the incentivise to supply - over 30 energy companies left - higher long run costs

Question 13

when did youth unemployment peak and by how much?

Answer 13

2022 - peaked at 14.8% with a rising nmw

caused by pandemic