Explain how the government of the country can initiate the demand and supply of the commodity without involving itself - Economics - Non-Competitive Markets

Question

Explain how the government of the country can initiate the demand
and supply of the commodity without involving itself

Shvetika Sharma · Accepted Answer

Dear Student,
The following steps can be taken by the government

To increase demand of a particular commodity,
government can give subsidy on that
particular commodity
To decrease demand of a particular commodity,
government can charge a higher tax on
that particular commodity
To increase supply of a particular commodity,
government can reduce tax on that
particular commodity
To decrease supply of a particular commodity,
government can charge a higher tax on
that particular commodity

Explain how the government of the country can initiate the demand and supply of the commodity without involving itself.