Question

Can government intervention in markets sometimes make the situation worse? Provide examples in your response. For...

  • Can government intervention in markets sometimes make the situation worse? Provide examples in your response. For example, consider the progress of the economy of Venezuela since 2000.

Homework Answers

Answer #1

Solution:

Venezuela facing Crisis in recent time after 2000 as dictatorship and socialism was trying to be set up their. USA and Russia unnecessary intervention made situation worst and put Venezuela in severe crisis.

  • This situation became worse when government inn Venezuela intervention in the free Market and decided price own self if oil and gas.
  • which effect demand supply law badly and economy conditions become worse as investor goes out from energy market ,investment crowd out and thus unemployment, poverty and other problem became severe and put Venezuela economy in severe slow down where cost pull inflation also a problem .
  • Thus government intervention make situation worse.

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