Governments have a range of objectives and these affect how they intervene in a mixed economy
Governments pursue several goals at once — such as fairness, growth, and a clean environment. The goal they prioritise shapes which policy tool they choose to use.
Real World
The UK government's 2021 Net Zero Strategy reflects a prioritisation of environmental objectives — it uses carbon taxes, subsidies for EVs, and regulatory bans on new petrol cars from 2035, each tool chosen to meet a specific climate goal.
Exam Focus
When government objectives conflict (e.g. growth vs. environment), state the trade-off explicitly — examiners reward candidates who identify opportunity costs between objectives.
Price Elasticity of Demand
PED = % change in quantity demanded ÷ % change in price
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