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Title: Microeconomics Definitions
Description: list of the microeconomics definitions for AS level
Description: list of the microeconomics definitions for AS level
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---Term
3 mark definitions
•
a market with many buyers and sellers, good market information and
ease of entry and exit
•
where the product is required for more than one use; an increase in
demand for one use will lead to a decrease in supply of the good for another
competitive market
comoosite demand
• a measure of the percentage change in the quantity demanded of one good
resulting from a percentage change in the price of another
cross elasticity of
demand
•
a good which generates negative externalities in consumption
•
The demand for a factor of production used to produce another good
...
demerit aood
derived demand
,I
economies of scale
equilibrium price
...
external costs
the price at which quantity demanded and quantity supplied are equal and
there is no excess supply or demand
the harmful or negative side-effects of an economic activity
•
effect on a third party as a result of an economic transaction
•
an economic resource used to produce goods and services
Externalities
factor of production
• when government intervention in a market leads to a less efficient
allocation of resource
government failure
income inequality
•
When there is an uneven distribution of money coming into households
internal economies of
scale
•
a fall in average cost due to growth of the firm
•the cost borne by the party involved in the transaction due to the
marginal private costs
market failure
consumption (or production) of an extra unit
•occ_urs when !he production and/or use of goods and services by the market
1s not efficient
• f
h demand and supply determine the price and quantity
means by ~hic_
o a good or service in a market
market mechanism
minimum orice
•
A price floor set by the government
...
Monopoly
CED measures thee t t t h
...
• benefits received by a third party
...
If it is positive, a rise
in income leads to a rise in quantity demanded (or vice versa)
...
positive income
elasticity of demand
price elasticity of supply
private costs
production
•
the lowest-average cost level of output
productive efficiency
public good
•
•
A product that is non-excludable and non-rival (an explanation of either
term is an acceptable alternative, but both concepts need to be covered for
3 marks)
factors of production for which demand exceeds supply
scarce resources
Social benefits
specialisation
• The private benefit of an economic activity plus the positive externality it
creates
...
•
money paid by the government to firms in order to reduce their costs
and/or increase competitiveness
•
The fall in average costs of production as the scale of production
increases due to improvements in the process of production
...
Title: Microeconomics Definitions
Description: list of the microeconomics definitions for AS level
Description: list of the microeconomics definitions for AS level