Author Question: What is the idea of fairness based on fair rules? What will be an ideal ... (Read 159 times)

dbose · **on:** Jun 29, 2018

What is the idea of fairness based on fair rules?

What will be an ideal response?

Question 2

If the elasticity of demand were positive what would this imply about the shape of the demandcurve? Why is it that we are unlikely to find a price elasticity of demand with a positive value?

What will be an ideal response?

Meganchabluk · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

The fair rules idea of fairness is that of providing equality of opportunity is necessary for the allocation of resources to be fair. This is the economic application of the symmetry principle, that people in similar situations be treated similarly. Equality of opportunity can be achieved if two rules are obeyed:
The government must enforce laws that establish and protect rights to private property that are held by individuals in society, and
Private property may be transferred from one person to another only by voluntary exchange and without fraudulent representation.

Answer to Question 2

If the price elasticity of demand were positive this would mean that demand curve is upward-sloping. We are unlikely to find a price elasticity of demand that is positive because this would contradict the law of demand.