Explain the importance of the competition

Assignment Help International Economics

Reference no: EM1375092

Our economy thrives on competition. Market forces will lead companies to manufacture the mix of goods most desired. Unforeseen events can be responded to in a rational manner. The constant struggle for profits will stimulate firms to cut costs. Note that technical efficiency results from attention to self-interest, not the public interest. However, in a market economy business must cater to the whims of consumer tastes or else go out of business.

Describe the importance of the following concepts:

1. Competition
2. Adequate information by all parties in the economy
3. The role of prices in a market economy

Reference no: EM1375092

Questions Cloud

Global financial contagion in future : The world economy retrenched in wake of a global financial crisis. Did globalization of capital markets contribute to this crisis? If so, what can be done to stop global financial contagion in future?

Show the benefits of international diversification : Suppose you are a fixed income fund manager based in euroland. Expected return of the EUR bond market is 4.4 percent and risk 5 percent, expected hedged return of the United Kingdom bond market 5.5% and risk 5.5 percent.

Long term correlation in domestic saving and investment : Martin Feldstein and Charles Horioka of Harvard University discusses that in a world of perfect capital market integration, there should be little long term correlation in domestic saving and investment.

Country net financial inflow and current account : Determine what has caused the United States run a merchandise trade deficit year after year since the early 1980 discuss the relationship between a country's net financial inflow and its current account?

Explain the importance of the competition : Our economy thrives on competition. Market forces will lead companies to manufacture the mix of goods most desired. Unforeseen events can be responded to in a rational manner.

Research in clinical lab testing : Your proposal to develop into 3-countries was approved by CEO. Now you have to make decision on a strategy - will PM firm simply sell its item or expand its markets via investment?

Determine the size of the national debt : Find the current state of the dollar versus other international currencies? What has been trend for the last six months and Determine the size of the national debt?

Total elimination of absolute advantage : The job losses to foreign nations have not been limited to low skilled rankings. And that may not necessarily be a real concern in long run.

Technological advances in telecommunications : Determine some of the technological advances in telecommunications and transportation that have impacted global business in the last decade?

User Account

All Pages