The GOP candidate lays out an ambitious economic agenda

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Article Review: The GOP candidate lays out an ambitious economic agenda
Economics majorly deals with the supply and demand for goods and services in the economy, in the micro-economics facet. This can only be attained by macro – economic tools namely taxation and government spending. In essence, if the desirable welfare goals are to be achieved, economists have to ensure that micro-economic and macro-economic principles work in tandem.
The theory of demand and supply is the foundation of micro economics because the prices of services and goods are dictated by preference and choice of consumers. Demand is the quantity of a product or service that an individual desires at a particular price, whereas supply is the quantity of a product that a producer is willing an able to supply to the market at a desirable price. Producers would only supply what consumers’ desire and tailor their products to satisfy the varied tastes of the final user of goods produced in the economy. Producers can only achieve satisfaction at the price where what they produce is equal to what the consumers demand and this has been coined as the point of market equilibrium.
The concept of market equilibrium is very essential because it is the point at which, if equilibrium price is exceeded, there would be excess supply in the market because the price would be too expensive for the consumers to afford, and would therefore opt for substitute goods. Producers may be forced to increase their prices above the market equilibrium because of rising production costs or increase in government taxes levied on them so it would naturally force them to pass this extra cost to the consumers. The effect of this action would be that there would be excess supply or a surplus in the market which is wastage in production. Therefore, the government should cushion the consumers against the rise in prices above the equilibrium and in the process prevent inflation by: lowering taxes on raw materials and giving tax holidays to investors to achieve the market balance. This would be characterized by a shift of the supply curve downwards to the original equilibrium level.
On the other hand, if prices were to fall below the equilibrium price, there would be a shrink in supply because producers would not be willing to supply goods at such low prices since they would only register losses. A phenomenon known as excess demand would emerge, as consumers would be scrambling for whatever bit of the commodity is available. Prices of complementary good...