Elasticity
The responsiveness of quantity supplied to a change in price
What is price elasticity of supply?
Drug use and alcohol consumption are an example of this type of externality
What is a negative externality of consumption?
Public goods display these two main features
What is non-excludable and non-rivalrous?
Focusing on one activity to be able to produce more efficiently
What is specialisation?
This is a scheme set in place to help push the cost of pollution back onto the producers
What are tradable pollution permits?
Quantity demanded has the same response as a change in price
What is unit elastic?
This is the extra benefit received by a consumer from consuming an additional unit of quantity
What is marginal private benefit?
When a person benefits from consuming a shared resource or good without paying for that good
A system of exchanging one product for another without the use of money as a medium of exchange
What is a barter system?
This is a system of trying to even out the supply of a product and tries to stop price volatility
What is a buffer stock scheme?
When the price of good B changes, the quantity demanded of good A changes by a smaller percentage in the opposite direction
What are weak complements?
This is the reduction in the overall welfare for society
What is deadweight loss?
Fly tipping and web viruses are an example of this
What are public bads?
When factors of production can move between different types of work
What is occupational mobility?
These are the two forms of price controls
What is a price ceiling and a price floor?
A high positive value of XED represents this
What are strong substitutes?
This can occur in situations of asymmetric information when the party with more information alters their behaviour, which causes extra costs for the other party
What is moral hazard?
It is more efficient to provide public goods at state level as it leads to lower long run cost per user
What is economies of scale?
One of the main problems with the barter system is that the person you are trading with must have what you want and want what you have
What is the double coincidence of wants?
This is the relative amount paid for by consumers and producers
What is the incidence of tax?
This is the good represented by a YED value between 0 and 1
What is a necessity good (inelastic normal good)?
These are the three possible solutions to fixing a positive externality of production
What is set a minimum price, add a subsidy, or demand promotion strategies?
What is allocative efficiency?
When evaluating specialisation and the division of labour, these three groups must be considered
Who are workers, firms and countries?
What is ad velorum?