How Market Imperfections and Market Failure Affect Entrepreneurship Activity

Business Economics

Table of Contents
INTRODUCTION.......................................................................................................................................3
MAIN BODY..............................................................................................................................................3
Using the case study, explain how market imperfections and market failure can affect entrepreneurship
activity?...................................................................................................................................................3
2. Explain how market imperfections and market failure affect labour and financial products using
relevant examples?..................................................................................................................................3
3. Provide a logical interpretation of how the UK government economic policies can shape business
strategy....................................................................................................................................................4
4. Interpret how UK government economic policies can shape business decisions?...............................5
CONCLUSION...........................................................................................................................................6
REFERENCES............................................................................................................................................7

INTRODUCTION
The business economy is an area of applied economics that examines corporate finances,
organisations, markets and the environment (Chang, McAleer and Wong, 2020). Based on
economic theories and mathematical approaches, the economics assesses some aspects affecting
companies – corporate structure, management, expansion and Policy. Topics in market economy
research can include how and why businesses grow, the influence of entrepreneurs, corporate
relationships and government regulatory position. This study builds on how the management of
the cigarette prices is essential to improve consumer stability, public revenue and public health.
MAIN BODY
Using the case study, explain how market imperfections and market failure can affect
entrepreneurship activity?
The market imperfection and market failure can affect the entrepreneurship activity.
Market failure directly leads to changes within the mind-set of entrepreneur in 10 also
lead to changes in their opportunity within the market for stop it is identified that there are a
number of entrepreneurs who are only working for the profitability (Strielkowski and
Chigisheva, 2018). But due to assistance market failure they can quit their Idea and can ship to
doing jobs of working within some company so market failure act as a major threat in front of
current time especially for the tobacco industry. Some of the major consequences of this are
discussed below:
Reduce market opportunity: Market imperfection and market failure directly leads to
reducing the market opportunities for the entrepreneur working within its first are this impact on
their motivation to work within the business and directly leads to shifting their mind set this can
be seen from the above case study where in proper allocation of prices within chemical industry
is leading towards changing mind-set of different players and closing their businesses (Mulhearn
and Vane, 2020). Number of entrepreneurs is based in the macro industry with the UK but due to
improper allocation and regular market failure leads to change in their mind set and uses their
market.
Black marketing of product: It can be analysed from which case study that Tum
equation part of that main line products in which if there is will be shortage in supply then the
demand will get higher and will lead to black marketing of the products (Tien, 2019). It is
identified that due to unfavourable policies of Government within this market most of the time
organisation working within it suffers the system of black marketing for staff act as an essential
element for different users where they will use to pay high prices at the time of insufficient
supply. The ultimate cause has to suffer by the enterprises working within the industry as due to
improper regulatory of prices different sales person use to Black Market the product which cause
damage to the reputation of the organisations working within it.