Identify the cases for government intervention in an economy, Microeconomics

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Problem 1:

i) How might unemployment arise?

ii) Critically explain how fiscal policy can be used to reduce the unemployment rate in an economy.

iii) ‘'Inflation always comes at the expense of unemployment''. Comment.

Problem 2:

i) Briefly identify the cases for government intervention in an economy.

ii) Suggest and evaluate ways of how government actually intervenes in such a situation.

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