AS 91402 · 5 credits · Internal
Market failure intervention
Demonstrate understanding of government interventions where the market fails to deliver efficient or equitable outcomes
Study with Coach
Save your actual school result to count your credits.
This standard asks you to explain why markets sometimes fail to deliver fair or efficient outcomes, and how the government can step in to fix these problems. You need to show you understand the problem, the government solution, and what that solution means for fairness and efficiency—backed up by economic diagrams and models.
What to do, grades and common mistakes
- ·Identify and explain a market failure (such as externalities, public goods, imperfect information, unequal income distribution, or under-provision of merit goods)
- ·Describe a specific government intervention that addresses that failure (such as taxes, subsidies, regulations, or government provision)
- ·Use an economic model (like supply and demand diagrams) to support your explanation
- ·Analyze the implications of the intervention for both efficiency and equity
- ·Compare or evaluate government interventions based on how well they balance efficiency and fairness
You explain why a market has failed, describe a government intervention, show it with an economic model, and explain what it means for efficiency and fairness.
You provide detailed explanations of the market failure, the intervention, and its effects, with a clear economic model supporting each point.