unit 4 subtopic C

Question 1

what is the aim of microeconomic reform

Answer 1

increasing productive potential of the economy by improving efficiency, productivity, and competitiveness

Question 2

what are 3 ways factors of production can be improved

Answer 2

finding new resources, improvement in technology, increase in skilled migration

Question 3

what is the effect of microeconomic reform on the PPC

Answer 3

if producing under the PPC, production will move closer to the curve
if producing on the curve, the curve will shift to the right

Question 4

what is deregulation and privatisation and how do they increase efficiency

Answer 4

deregulation- reducing government regulations that restrict businesses (improves efficiency by increasing competition, innovation, and reducing business costs)

privatisation- transferring ownership of a business to the private sector (improves efficiency through profit motivation, performance based incentives, improved management)

Question 5

what are 3 types of efficiencies

Answer 5

allocative efficiency- the most effective allocation of resources
dynamic efficiency- long-term efficiency
technical efficiency- lowest cost per output

Question 6

what does internal balance mean

Answer 6

price stability and full employment