Across
- 2. An agreement between countries to phase out or eliminate tariffs and other trade barriers and establish a common external barrier toward non-members. 2 words
- 3. The limited availability of economic resources relative to society’s unlimited needs and wants of goods and services.
- 4. Achieved when just the right amount of goods and services are produced from society’s point of view so that scarce resources are allocated in the best possible way. It is achieved when, for the last unit produced, price (P) is equal to marginal cost (MC), or more generally, if marginal social benefit (MSB) is equal to marginal social cost (MSC).2 words.
- 6. The provision of small loans to poor entrepreneurs who lack access to traditional banking services.
- 7. The case where equilibrium real output exceeds potential output as a result of an increase in AD. 2 words.
- 9. An expansionary monetary policy where a central bank buys (long term) government bonds or other financial assets, in order to stimulate the economy and increase the money supply. 2 words.
- 10. A loss of a part of social surplus (consumer plus producer surplus) that occurs when there is market failure so that marginal social benefits are not equal to marginal private benefits. 2 words.
- 11. Refers to the preserving the environment so that it can continue to satisfy needs and wants into the future.
- 13. Refers to situations when people rely on a piece of information that is not necessarily relevant as a reference point when making a decision.
- 14. A type of market failure involving asymmetric information where a party takes risks but does not face their full costs by changing behaviour after a transaction has taken place. It is very common in insurance markets. 2 words
Down
- 1. The education, training, skills, experience and good health embodied in the labour force of a country. 2 words.
- 5. Taxation where the fraction of tax paid decreases as income increases. The average tax rate decreases. 2 words
- 8. Income not spent on domestic goods and services. It includes savings, taxes and import expenditure.
- 12. A monopoly that can produce enough output to cover the entire needs of a market while still experiencing economies of scale. Its average costs will therefore be lower than those of two or more firms in the market. 2 words