Government Tools: Discuss tools available to the government to correct a market failure. Provide examples from the textbook. The tools available to the government to correct market failure are subsidies, trade restrictions, and taxes. Supply and Demand Equilibrium: Describe how government intervention affects the supply and demand equilibrium. Refer to the simulation game to explain your responses. Charging taxes (both positive and negative externalities) is the way government intervention affects the supply and demand equilibrium. The government also utilize price ceilings. Whenever I placed a bid, the nuisance charge applied to the produce with the offer. Selling your product at the wrong rate can lead to a supply shortage. So, making sure you price your product correctly is an important think to keep in mind. Consumer or Producer Surplus: Specify which government interventions cause a consumer of producer surplus. Explain how they impact consumer or produce surplus. Provide examples from the textbook. Price ceiling and pricing floor are the government interventions that cause a consumer or producer surplus. The price of the product will in no way top the price cap and won't go beneath the minimum cost because of the price ceiling and price floor. Buyers are able to risk presenting a lesser bid knowing the vendor will accept because of the likelihood the buyer dropping out. The buyer starts the bid at a low-level while being mindful not to lose to another buyer. The producer's goal is to pay attention for the highest bidder with the knowledge that it may not work to their advantage