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Flashcards in key terms Deck (4)
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1
Q

ad valorem tax

A

a sales tax that is set at a percentage of the price

2
Q

adverse selection

A

a situation in which a person at risk is more likely to take out insurance

3
Q

allocative efficiency

A

achieved when society is producing an appropriate bundle of goods relative to consumer preferences

4
Q

asymmetric information

A

a situation in which peoples ability to take rational decisions is limited by a lack of information.