MF

Question 1

Prod eff

Answer 1

max possible amount of output is being produced from a given amount of resources

Question 2

Alloc eff

Answer 2

societal welfare being maximised

Question 3

Non-excludable

Answer 3

impossible to exclude non-payers from consuming the good

Question 3

Public Goods

Answer 3

non-rivalrous, non rejectable and non-excludable

Question 4

Non-rivalrous

Answer 4

consumption of good by one or more consumers does not reduce the quantity available for others to consume

Question 5

non-rejectable

Answer 5

consumers are unable to refuse consumption of a good

Question 6

negative externalities

Answer 6

negative spill over effects to third parties from the consumption or production of a good

Question 7

positive externalities

Answer 7

positive spill over effects on third parties generated from consumption or production of a good

Question 8

imperfect info

Question 9

asymmetric info

Answer 9

one party has more information than the other

Question 10

factor immobility

Answer 10

inability of FOPs to shift from one country to another due to geographical or occupational boundaries

Question 11

mkt failure

Answer 11

the free market fails to achieve alloc eff, resulting in societal’s welfare not being maximised