Merit goods - short answer
Explain, with the aid of examples, the main characteristics of merit goods.
To what extent is it desirable that the government should provide merit goods?
Discuss the case for and against doctors charging patients for their services
Why might housing be described as a merit good?
Discuss the arguments for and against the state reducing its role in the direct provision of housing.
Classify the following goods as either public (P), merit (M) or demerit goods.
|Good||Public (P), merit (M) or demerit (D)?|
|Health care (free)|
|Nursery education (pre-school)|
The effect of subsidising theatre tickets will, to a large extent, depend on the elasticity of demand for theatre tickets. Draw two diagrams, one with a relatively inelastic demand curve and one with a relatively elastic demand curve. Explain the different effects on price and quantity.
"Education, health care and housing are best provided through the market." Discuss.