Govt Int Definitions

  1. Regulation
    The imposing of rules, controls and constraints, which restrict freedom of economic action in the market place.
  2. Tax
    A compulsory levy imposed by the government to pay for its activities. Taxes can also be used to achieve other objectives, such as reduced consumption of demerit goods.
  3. Price Ceiling
    A price above which it is illegal to trade. Price ceilings, or maximum legal prices, can distort markets by creating excess demand.
  4. Price Floor
    A price below which it is illegal to trade. Price floors, or minimum legal prices, can distort markets by creating excess supply.
  5. Government failure
    Occurs when government intervention reduces economic welfare, leading to an allocation of resources that is worse than the free-market outcome.
  6. State Provision
    Where the government provides a good/service or publicly funds a service/good, financed through direct taxation and offered free at point of use. Also referred to as direct or public provision.
  7. Tax Relief
    Similar to subsidies, use to increase consumption of goods with positive externalities.
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Anonymous
ID
318698
Card Set
Govt Int Definitions
Description
Govt Int Definitions
Updated