Question

Are there any advantages to a single market seller and how do they compare to its perceived disadvantages?

Answer 1

Answer:

Explanation:1. Consumer Sovereignty

In a free market, producers produce what consumers want at a reasonable price. It gives the consumer more choice for their purchases.

2. Absence of Bureaucracy

Free markets reduce cost, lead to more innovation and research & development through the absence of red tape. Entrepreneurs don’t have to wait for the government to tell them what to make. They study demand, research trends and meet the customer’s needs through innovation. This also encourages competition amongst firms to improve their product and service.

3. Motivational Influence of Free Enterprise

Guided by the invisible hand, entrepreneurs take a risk to fulfill consumer demand. Those entrepreneurs who succeed are rewarded with profits. (The invisible hand is an economic concept where market demand act as signals for producers, i.e., because consumers want and are willing to pay for bread, a baker has the incentive to produce bread).

ADVANTAGES OF A FREE MARKET

4. Optimum Allocation of Resources

Resources in the market are better distributed and allocated. Since consumers are willing to pay for a certain quantity of a product, producers are willing to pay to acquire raw materials. Otherwise, producers produce too much of a good that no one wants. It also encourages firms to be more efficient as they seek to produce at the lowest price possible to maximize their profit.

Answer 2

Answer:

Single market is a type of set up in which arrangements are made between different nations such that they can share access to a common market place for selling goods. In this type of arrangement, different nations actually deal with each other as far as goods and service movement is concerned.

Explanation:

Advantages of single market system:-

There certainly are a number of advantages of sharing single market for sellers.

i) Sellers get free access to a common market place.

ii) local firm economy scale can easily be exploited with an aim to expand the market reach

iii) Single seller market also offers with reduced cost and less competition.

iv) Manufacturers can also maintain their standard along with regular technology transfer along with labor mobility.

Disadvantages of single market

i) One of the main disadvantages is the trade diversion feature for non members and crowded market.

ii) Less wages for labors and increasing negative externalities.

iii) Trade rules and regulations may not favor every member and bureaucracy issues.

iv) Members may not be able to respond to failing Global economy.