Chapter 1, Problem 12P

To determine

Determine:

The importance of government’s intervention in improving the society’s welfare by changing people’s incentives and the areas in which market is going wrong.

Government intervention improves society’s welfare

Social welfare is a policy in which the main target is the well-being of society and government intervention is an action of government that affects the market economy directly or indirectly. Government plays a major role in improving society’s welfare. The society includes every class of people; therefore, the government should not only take necessary steps, but should also act wisely for the betterment of the people and development of the country.

To determine

Determine:

The importance of government’s intervention in improving the society’s welfare by changing people’s incentives and the areas in which market is going wrong.

Government intervention improves society’s welfare

Social welfare is a policy in which the main target is the well-being of society and government intervention is an action of government that affects the market economy directly or indirectly. Government plays a major role in improving society’s welfare. The society includes every class of people; therefore, the government should not only take necessary steps, but should also act wisely for the betterment of the people and development of the country.