Economics 0.0 / 5 ? EconomicsMonopolyA2/A-levelAQA Created by: Jemma007Created on: 05-01-18 10:22 Concentration ratio The market share held by the 4 or 5 largest firms in an industry 1 of 13 The Herfindahl-Hirschman Index (HHI) The index is calculated by squaring the % market share of each firm in the market and summing these numbers 2 of 13 Natural barriers Such as economies of scale and indivisibilities where goods can't be produced in small quantities 3 of 13 Artificial barriers Such as advertising and pricing strategies 4 of 13 Horizontal integration This is where two firms join at the same stage of production 5 of 13 Vertical integration This is where a firm integrates at different stages of the production process 6 of 13 Indirect tax - Flat Rate tax The amount charged is the same per unit 7 of 13 Indirect tax - Ad Valorem tax Is charged as a % of the cost of the good 8 of 13 Market failure Where resources are allocated inefficiently 9 of 13 Subsidy A government policy to correct government failure 10 of 13 Commodity money The use of a specific commodity as a form of money, e.g. gold, silver, oil 11 of 13 Credit money Credit money is any future monetary claim against an individual that can be used to buy goods and services 12 of 13 Fiat money Fiat money is currency that a government has declared to be legal tender, but is not backed by a physical commodity. 13 of 13
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