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Edexcel Economics 3 Market Failure & Government Intervention

In this quiz the answers change every time you play! Guess the terms that fit these definitions
Answer must correspond to highlighted box!
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robalot39
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Last updated: May 29, 2019
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First submittedMay 27, 2019
Times taken34
Average score30.0%
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Description
Term
The way in which the burden of paying a sales tax is divided between buyers and sellers
Incidence of a Tax
Where governments set maximum or minimum prices
Price Controls
A tax that takes a larger percentage from high-income earners than from low-income earners
Progressive Tax
The cost incurred by an individual or firm as a result of its activities but which is borne by a third party
External Cost
A good or service that a consumer can decide against using
Rejectable
Where a market does not supply any of a product at all
Complete Market Failure
Where a market does not achieve an efficient allocation of scarce resources
Market Failure
Where the social benefits of production and/or consumption exceed the private benefits
Positive Externality
Where resources are distributed in a way that maximises consumer satisfaction, and where the price of a product is equal to the marginal cost of producing it
Allocative Efficiency
Where social costs exceed social benefits
welfare loss
Where the costs of implementing, and/or regulating a policy are too high
Excessive Administation Costs
Where circumstances may change between the recognition of a problem and the designing, and implementation of a policy
Time Lags
Where both sides of the market have access to a similar amount of information
Symmetric Information
A positive or negative externality that is caused by the demand side of the market
Consumption Externality
Composed of both productive efficiency and allocative efficiency
Economic Efficiency
Where a person is more likely to selectively engage in trades that benefit them the most to others' disadvantage
Adverse Selection
Who shoulders the greater tax burden when demand is relatively inelastic?
The Consumer
The term for the amount of tax absorbed by both consumers and producers
Burden
The total of both private benefit and external benefit
Social Benefit
Where the social costs of production and/or consumption exceed the private costs as a result of no appropriate compensation being paid
Negative Externality
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