A-Level Economics

3. A tax system designed to redistribute income and reduce inequality.
6. A source of allocative inefficiency and potential X-inefficiency.
10. A phase in the business cycle characterized by falling output, rising unemployment, and reduced investment.
12. The point where market clearing occurs, but may not be socially optimal in the presence of externalities.
14. A measure of responsiveness that is crucial for analysing the impact of taxes and price controls.
15. A policy objective to reduce inflation without causing a recession.
16. A non-conventional monetary policy tool used to stimulate aggregate demand during a liquidity trap.
18. A crucial component of aggregate demand, influenced by interest rates and business confidence.
19. A trade barrier that can lead to welfare loss and retaliatory measures.

1. The concept that guides optimal decision-making by comparing incremental changes.
2. Economic thought advocating for active fiscal policy to manage fluctuations in the business cycle.
4. Policy aiming to improve the current account by making exports cheaper and imports dearer.
5. Government intervention aimed at correcting market failures, but potentially leading to regulatory capture.
7. A key driver of long-run economic growth, often influenced by technological progress.
8. A market where strategic interdependence necessitates game theory.
9. A phenomenon associated with debt deflation and the potential for a liquidity trap.
11. A form of government intervention that can create deadweight loss or encourage overproduction.
13. Maximising this is the ultimate goal of many government interventions, though its measurement is complex.
17. A divergence between private and social costs or benefits, leading to market failure.
18. A phenomenon eroding the real value of money and potentially leading to menu costs.