The flash crash was the major stock crash that occurred in the United States. The government could have contributed the flash crash by the government regulation on the market stock that reduced cash value. This was motivated by the market reforms that were aimed at…
Download file to see previous pages...
Cash dropped suddenly to zero levels and researchers when marketers left in 1962 because of significant finding by market specialists during that time (SEC, 2010). Therefore, prices were destroyed by sudden drop of cash because of strict government regulation.
3. The crash extremely damaged the assurance of stakeholders, who tendered nineteen billion from local equity resources during that time when the increased outflow of cash during the crisis of 2008. The financial challenge contributed to the current financial crisis affecting the economy.
4. The phrase “like a balloon” means that the flash crash in the market is similar to a balloon when squeezed from one point the problem emerges from another point (SEC, 2010). Therefore, as the congress tries to fix the system by adding more regulation, in turn will contribute to several problems instead of solving them (Kramer and Corcoran, 2010). Apart from this, the crash contributed to a expansion with potential long-term impact on economic markets. It also contributed to proposed ways of controlling future flash crash in the market prices using computerized procedures to control the stock markets. Such crashes happen abruptly and fast spread through the market affecting monetary flows.
5. Rules established by the government contributed to the flash crash. Several rules and regulation will make business persons become voracious marketers replaced by machines. This will make the situation worse by not having any support during increase of flash crash. Therefore, specialists noted that the society needed up creating a cheap price to unknown, difficult situation (Kramer and Corcoran, 2010). In reality, the crash complex the disintegration of market cash undermining the essential price innovation process for evident stocks. The last regulation had been presented to aid the events of large supply market contestants, as well as a lot of
...Download file to see next pagesRead More
Cite this document
(“Government Intervention on the Market Assignment”, n.d.)
Retrieved de https://studentshare.org/macro-microeconomics/1646717-government-intervention-on-the-market
(Government Intervention on the Market Assignment)
“Government Intervention on the Market Assignment”, n.d. https://studentshare.org/macro-microeconomics/1646717-government-intervention-on-the-market.
This assessment will also include market failure and the steps United Kingdom government has taken to avoid market failure. Free Market System and Arguments in its Favour Free market system of resource allocation is based on the principles of supply and demand (Gregory & Stuart, 2003).
The sellers take goods to the market and depending on the demand of the good, a price is set. If there is high demand for the good, the buyers compete for the good pushing the prices up and if demand is low, the sellers compete for the few buyers in the market thus pushing the prices down.
Federal marketing orders have been imposed on fruits, milk, vegetables, raisins and other agricultural products. Marketing orders are said to have originated as early as 1920s with farmers trying to impose regulatory controls on crops voluntarily (Christensen 17).
Due to large number of firms in industry, the firms are forced to accept prices set by demand and supply in the market. Structure does not create barrier for entry and exit to market. Organizations to gain profits perform with high efficiency and innovation level in offerings is lowest.
The situation particular refers to the economic condition where resources are not being efficiently used within the economy, thus leading to the fall of the real output continuously below the potential output (Jain, Ohri, Majhi and Ohri 193). Correspondingly, the recessionary gap and its associated causing factors are identified and treated distinctively as per the assumptions of the new Classical approach and the Keynesian approach.
According to the report there is information gathering by the buyers and sellers. This is important in helping to remain informed about the major aspects influencing different forces in the market. A market also plays the role of price control. This includes ensuring stable prices for commodities and services.
The two events are important because they provide an analysis of economic events that affected people during the 1930s and 1940s. The occupy movement can learn from the great compression that strong unions and
It has suffered a massive drought for the past three years due to the lows of Californias river and reservoir levels2. It became so severe that the government and the federal state cut off the water supply that runs from (sierras to the valley)
The actions taken by the Chinese government and the manner in which such impacted on the market remains central to this discussion. The author notes that the Chinese government, during the onset of economic meltdown of 2008, adopted measures aimed at boosting the economy and extended them to periods when the stock markets had regained its right footing.
3 Pages(750 words)Assignment
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Assignment on topic Government Intervention on the Market for FREE!