A-Level Economics Key Terms And Definitions - Statistics

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This quiz has been taken 153 times
The average score is 15 of 60

Answer Stats

Hint	Answer	% Correct
When supply equals demand.	Market Equilibrium	61%
A single seller of a product in a given market or industry.	Monopoly	61%
A market dominated by a few large suppliers.	Oligopoly	59%
The value of the next best alternative foregone.	Opportunity Cost	56%
A fall in the rate of inflation. This means a slower increase in prices but not a fall inprices.	Disinflation	50%
A government grant given to firms into to help lower their cost of production andincrease output.	Subsidy	50%
Goods in competitive demand and act as replacements for another product.	Substitute Goods	50%
A tax on imported products which may be ad valorem or a specific tax.	Tariff	50%
When government spending is greater than tax revenues.	Budget Deficit	49%
The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually pay.	Consumer Surplus	48%
Costs that vary directly with the level of output.	Variable Cost	45%
Factors of production that are used to make other goods and services.	Capital	44%
Goods that are both non-rival and non-excludable.	Public Goods	44%
A period of at least six months (two quarters) when an economy suffers a fall in output.	Recession	44%
A tax where low income earners pay a higher proportion of their income in tax than high income earners.	Regressive Tax	44%
Quantity of a good or service that consumers are willing and able to buy at a givenprice in a given time period.	Demand	41%
The change in total costs resulting from increasing output by one unit.	Marginal Cost	41%
A legally-imposed price in a market that suppliers cannot exceed.	Maximum Price	41%
Involuntary unemployment due to a lack of demand for goods and services.	Cyclical Unemployment	40%
A composite measure of development in countries, quantified in terms of expectedand means years of schooling, life expectancy and purchasing power.	HDI	40%
When the market mechanism fails to allocate resources efficiently.	Market Failure	40%
A limit on the quantity of a product can be supplied to a market.	Quota	40%
Occurs when third parties benefit from the spill-over effects of production/consumption.	Positive Externality	39%
Factors which make it difficult or expensive for new firms to enter a market in order tocompete with existing suppliers.	Barriers To Entry	38%
Objective statements that can be tested or rejected by referring to the available evidence.	Positive Statements	38%
A persistent decrease in the general price level of goods and services in a country over time.	Deflation	37%
Investment from overseas businesses into a specific country.	FDI	37%
The ever increasing integration of the world’s local, regional and national economiesinto a single market.	Globalisation	37%
A legally imposed price below which the normal market price cannot fall.	Minimum Price	37%
Total cost divided by the number of units produced.	Average Cost	36%
The responsiveness of demand for a product following a change in its own price.	Price Elasticity Of Demand	36%
The breaking down of a production process in smaller, specific tasks, intended to increase productivity.	Division Of Labour	35%
If there is an initial injection into the economy then the final increase in AD and Real GDP will be greater.	Multiplier Effect	35%
Transitional unemployment as people move between jobs or are in active job search.	Frictional Unemployment	34%
A boundary that shows the maximum combinations of two or more goods and servicesthat can be produced when all resources are used efficiently.	PPF	34%
The process of transferring ownership of a public asset or service from the government to the private sector.	Privatisation	34%
Spending on capital goods including plant & machinery and infrastructure.	Investment	33%
The increase in revenue resulting from an additional unit of output.	Marginal Revenue	33%
A mismatch between people’s skills and requirements of the new jobs due to occupational and geographical immobility of labour.	Structural Unemployment	33%
When the value of exports exceeds the value of imports in a given time period.	Trade Surplus	33%
This measures the extent to which the distribution of income among individuals or households within an economy deviates from a perfectly equal distribution.	Gini Coefficient	32%
Goods or services purchased in one country but produced in another.	Imports	31%
A tax that takes an increasing proportion of income as income rises.	Progressive Tax	31%
This occurs when somebody (buyer/seller) knows more than somebody else in the market.	Asymmetric Information	30%
Effects on a third party outside the price mechanism arising from the production or consumption of goods and services.	Externalities	30%
Any explicit or implicit agreement between suppliers in a market to avoid competition.	Collusion	29%
A tax on the profits made by firms.	Corporation Tax	29%
The consumption of these goods may lead negative externalities which causes a fall in social welfare.	De-Merit Goods	29%
Quantity of a good or service that a producer is willing and able to provide to the market at a given price in a given time period.	Supply	29%
A formal agreement among firms that agree to reduce competition in an attempt to increase profits. Usually occurs in oligopolistic markets.	Cartel	28%
Occurs when production and/or consumption impose external costs on third parties outside of the market for which no appropriate compensation is paid.	Negative Externality	28%
The use of tariff and non-tariff restrictions on imports to protect domestic producersfrom foreign competition.	Protectionism	28%
Ability of people to undertake trade with people in other countries free from anyrestraints imposed by governments or other regulators.	Free Trade	27%
The consumption of a good by one person does not reduce the amount available for others.	Non-Rivalrous	27%
The responsiveness of supply of a product following a change in its price.	Price Elasticity Of Supply	27%
The difference between what producers are willing and able to supply a good for andthe price they actually receive.	Producer Surplus	27%
The relative advantage that one country has over another.	Comparative Advantage	26%
Subjective statements, containing a value judgement which cannot be tested.	Normative Statements	26%
A method of production where a business or area focuses on the production of alimited scope of products or services to gain greater productive efficiency.	Specialisation	26%
When a country imports a greater value of goods and services than it exports.	Trade Deficit	26%
A merger of two firms that have completely unrelated business activities (not within the same industry).	Conglomerate Merger	25%
The loss in producer and consumer surplus due to an inefficient level of production.	Deadweight Loss	24%
Used to describe a severe recession which may become a prolonged downturn in theeconomy and where GDP falls by at least 10%.	Depression	24%
When a producer in one country exports a product to another country at a price which is below its costs of production.	Dumping	24%
The sum of gross value added by all resident producers divided by the population.	GDP Per Capita	24%
Measures the relationship between a change in quantity demanded and a change inreal income.	Income Elasticity Of Demand	24%
Period of time in which all inputs may be varied but the basic technology of production is unchanged.	Long Run	24%
A measure of money's value in terms of what it can buy.	Purchasing Power	24%
The extent to which a household's financial resources falls below an average income threshold for the economy. Exact definition varies by country	Relative Poverty	24%
Where two firms at different stages of production within the same industry merge.	Vertical Integration	24%
Reductions in long-run average cost from an increase in output.	Economies Of Scale	23%
The barriers preventing people from moving from one area to another to find work.	Geographical Immobility	23%
Money that flows freely around the world looking to earn the best available rate ofreturn.	Hot Money	23%
Made when total revenue is greater than total costs.	Profits	23%
The sending of money to people in another country.	Remittance	23%
When the value of an asset or exchange rate increases in value relative to another.	Appreciation	22%
Balance of trade in goods, services, net transfers of money and net investment income.	Current Account	22%
Similar to GDP except that it adds what a country earns from overseas investmentsand subtracts what foreigners earn in a country and send back home.	GNI	22%
Where two firms join at the same stage of production in the same industry.	Horizontal Integration	22%
The cost of production or consumption of a product for society as a whole.	Social Cost	22%
A tax that is imposed on producers (suppliers) by the government.	Indirect Tax	21%
When demand for a product falls as real incomes increases.	Inferior Good	21%
Goods for which demand increases more than what is proportional as income rises.	Luxury Goods	21%
Subcontracting a process, such as design or manufacturing, to another company.	Out-Sourcing	21%
A system similar to the CPI but includes mortgage repayments and sometaxes, and excludes the top 4 per cent of earners.	RPI	21%
The benefit of production or consumption of a product for society as a whole.	Social Benefit	21%
A tax on a percentage of the value (sales price) of a good or service.	Ad Valorem Tax	20%
Automatic fiscal changes that occur as the economy moves through stages of the business cycle.	Automatic Stabilisers	20%
A decline in the share of national income from manufacturing industries.	De-Industrialisation	20%
The number of people claiming unemployment-related benefits.	Claimant Count	19%
When income increases, quantity demanded increases.	Normal Goods	19%
A measure of efficiency = output per unit of input or output per person employed.	Productivity	19%
A tax per unit levied on our spending on goods and services such as cigarettes, fueland alcohol.	Specific Tax	19%
The total of all the money coming into a country from abroad minus all of the moneygoing out of the country during the same period.	Balance Of Payments	18%
A good that society values and judges that everyone should have regardless of whether an individual wants them.	Merit Good	18%
The exchange rate that equates the price of a basket of identical traded goods andservices in two countries.	Purchasing Power Parity	18%
Attempts by a central bank to increase the base supply of money by buying debt offbanks and other financial institutions.	Quantitative Easing	18%
A function of the price mechanism which occurs when prices adjust to show where resources need to be allocated and where they are not needed.	Signalling	18%
When government spending is being cut and/or taxation is being raised.	Fiscal Austerity	16%
When people take actions that increase social costs because they are insured againstprivate loss.	Moral Hazard	16%
A payment of money for which there are no goods or services exchanged. Typically seen in government welfare payments.	Transfer Payments	16%
A government policy to expand money supply and boost economic activity, mainly by keeping interest rates low to encourage borrowing by companies, individuals and banks.	Expansionary Monetary Policy	15%
Different stages of making, distributing and selling a good or service from theproduction of parts, through to distribution and sale of the product.	Supply Chain	15%
The cost to the parties directly involved in an economic transaction.	Private Cost	14%
When a business reaches the lowest point of its average cost curve.	Productive Efficiency	14%
A monopoly limited to a specific geographical area.	Local Monopoly	13%
The difference between potential and actual real national income in an economy.	Output Gap	13%
The first company to introduce a new product to market, has the opportunity toextract the greatest long term benefit from the product compared to that which following companies would be able to gain.	First Mover Advantage	11%
Resources which are finite and cannot be replaced.	Non-Renewable Resources	11%
The process by which changes in interest rates and/or the supply of money work toaffect demand, output and prices.	Transmission Mechanism	11%
Competing through means such as the quality of the product, packaging, customer service, etc.	Non-Price Competition	10%
People of low incomes are disincentivised to look for work or work longer hours because of the effects of the tax and benefits system.	Poverty Trap	9%
Where the expected value of a transaction is known more accurately by the buyer or the seller due to an asymmetry of information.	Adverse Selection	8%
When the value that consumers place on a good or service equals the cost of the resources used up in production. Price = Marginal Cost.	Allocative Efficiency	8%
Goods that are useful not in themselves but for the goods and services they can help produce in the future.	Capital Goods	8%
Responsiveness of demand for good X following a change in the price of good Y (arelated good).	Cross Price Elasticity Of Demand	8%
The reduction of risk achieved by replacing a single risk with a larger number ofsmaller unrelated risks.	Diversification	8%
The balance between the value of exports and imports.	Net Trade	8%
A measure of who ultimately pays a tax, either directly or through the tax burden.	Tax Incidence	8%
A market where no single firm has a dominant position and where the consumer hasplenty of choice when buying goods or services. There are few barriers to the entry of new firms.	Competitive Market	7%
Unemployment which is known to exist but is not included in the official governmentfigures, also known as under-employment.	Hidden Unemployment	7%
This is the monetary value of all goods and services expressed at current prices.	Nominal GDP	7%
Measures taken by government to transfer income from some individuals to others.	Redistribution	7%
Variations in the annual rate of growth of an economy over time.	Economic Cycle	6%
Jobs for all that want them but not zero unemployment because some people arealways between jobs.	Full Employment	6%
Income after taxes and benefits, adjusted for the effects of inflation.	Real Disposable Income	6%
The number of people able, available and willing to work at prevailing wage rates.	Labour Supply	5%
A foreign currency that is held in countries’ official reserves due to its inherent stability.	Reserve Currency	5%
When the prospect of the loss of unemployment benefits dissuades those withoutwork from taking a new job.	Unemployment Trap	5%
The rate of interest market investors demand when purchasing government bonds.	Bond Yield	4%
Where a firm or economy can produce more with existing resources.	Spare Capacity	4%
Intentional government policies to increase or decrease government spending or taxation.	Discretionary Fiscal Policy	3%
Capital investment is linked positively to expected growth of consumer demand.	Accelerator Effect	2%
Spill-over effects from economic activity are absorbed by the consumer or firm themselves.	Internalisation	2%
The amount of debt that a business or country has expressed as a share of GDP.	Debt Burden	0%
The reserves of gold or foreign currencies typically held by central banks on behalf of their national government	Foreign Exchange Reserves	0%
Exists when there is willingness to purchase a good or service, but where the consumer lacks the purchasing power to be able to afford the product.	Latent Demand	0%

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