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1. Economic Matters > lol > Flashcards

lol Flashcards

1
Q

PASIFIC

A 
Population
Advertising
Substitutes
Income
Fashion/Trends
Interest rates
Complements
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2
Q

PINTSWC

A 
Productivity
Indirect tax
Number of firms in the market
Technology
Subsidies
Weather
Costs of production (wages, raw materials, etc)
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3
Q

What is a market

A

A place where buyers and sellers come to exchange goods and services

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4
Q

ARSI

A

allocates
Rations
Signals
Incentives

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5
Q

SPLAT

A 
Substitutes
Percentage of income
Luxury
Addictive
Time period
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6
Q

EOIS

A

Elastic
Opposite
Inelastic
Same

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7
Q

PSSST

A 
Production lag
Stocks
Spare capacity
Substitutability
Time period
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8
Q

YED

A

%ΔQd/%ΔY

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9
Q

XED

A

%ΔQdA/%ΔPB

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10
Q

PartySeasonNearChristmas

A

PositiveSub-NegativeComp

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11
Q

Externality flow

A 
1) What moves:
 Production -> costs
 Consumption -> benefit
2)Which way:
-ve -> left
\+ve -> right
3) moving curve is always social
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12
Q

MERIT

A
  • Underconsumed
  • Missing information regarding the private benefit
  • Have positive externalities
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13
Q

DEMERIT

A
  • Over Consumed
  • Missing information regarding the private costs
  • has negative externalities
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14
Q

Public

A

non-excludable

non-rival

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15
Q

Economic problem

A

How to allocate resources amongst alternative uses. What to produce, for whom and how..

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16
Q

Scarcity

A

The situation where there are unlimited wants but finite resources.

17
Q

Opportunity cost

A

the value of the next best alternative forgone when making a choice

18
Q

4 FoP

A

Capital
Enterprise
land
labour

19
Q

Specialisation

A

The concentration of a worker, firm, region or country to produce a narrow ranges of goods/services

20
Q

Division of labour

A

The specialisation of labour where the production process is broken down into separate takes

21
Q

Advantages of division of labour

A
  • More efficient workers
  • More goods can be produced than before
  • Leading to higher skills thus can demand higher wages
22
Q

Disadvantages of labour

A
  • Lack of flexibility of workers hence boredom

- Over specialising thus workers may be unable to switch to other jobs

23
Q

Advantages of specialisation

A
  • Increase in world output
  • Increase in widening range of goods available
  • Possible increased trade between developed and developing countries could increase the world equality
  • Competition between firms means they must be efficient to survive
24
Q

Disadvantages of specialisation

A
  • Adverse weather effects
  • Reduced flexibility
  • Trends/fashion
  • Relies on finite resources
  • may entail purchasing of tech and capital to replace humans as workers thus unemployment
25
Q

Define PPC

A

Shows the maximum potential output of two goods that can be produced in the current time period if all goods are efficiently employed

26
Q

Consumer surplus

A

The difference between what consumers are willing to pay and the price they actually pay (they’re benefit)

27
Q

Producer surplus

A

The difference between what consumers are willing to sell for and the price they actually sell for
(they’re benefit

28
Q

Allocative efficiency

A

Where customer satisfaction is maximised (where P=MC) or =S=D

29
Q

Productive efficiency

A

Where production takes place using the least amount of scare resource for maximum output (bottom of AC curve

30
Q

Externalities

A

Costs to 3rd party not involved in a transaction or consumption of a good

31
Q

Negative externalities

A

Where the social costs of an activity are greater than the private costs

32
Q

Positive externalities

A

Where the social benefits are greater than the private benefits

33
Q

market failure

A

where the free market mechanism fails to achieve economic effiency

34
Q

FORs of tradable permits

A
  • Market based s

1. Economic Matters (5 decks)

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