Mr valentine

Question 1

Free Market Economies

Answer 1

Market forces (supply and demand) are allowed to guide the allocation of resources within a society

Question 2

Mixed Economies

Answer 2

Resources are allocated partly through price signals and partly on the basis of direction from the government

Question 3

Planned Economies

Answer 3

Decisions on resource allocation are guided by the state

Question 4

Productive Efficiency

Answer 4

Production at its lowest average cost, using fewest resources

Question 5

Allocative Efficiency

Answer 5

Achieved when consumer satisfaction is maximised

Question 6

Economic Efficiency

Answer 6

A situation in which both productive efficiency and allocative efficiency have been reached

Question 7

Pareto Optimum

Answer 7

When no reallocation of resources can make an indivisible better off without making some other individual worse off

Question 8

Fixed costs

Answer 8

Do not vary in the short run with changes in output

Question 9

Variable Costs

Answer 9

Vary directly with changes in output

Question 10

Short Run

Answer 10

The time period when at least one factor of production, usually capital, is in fixed supply