Government intervention and government failure Keywords

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Government failure
A misallocation of resources arising from government intervention
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Indirect tax
A tac levied on expenditure on goods r services (as opposed to a direct tax, which is a tax charged directly to an individual based on a component of income)
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Specific tax
A tax of a fixed amount imposed on purchased of a commodity
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Incidence of a tax
The way in which the burden f paying a sales tax is divided between buyers and sellers
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Ad valorem tax
A tax levied on a commodity set as a percentage of the selling price
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Subsidy
A grant given by the government to producers to encourage production of a good or service
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Excess burden of a slaes tax
The deadweight loss to society following the imposition of a sales tax
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Minimum wage
A system designed to protect the low paid by setting a minimum wage rate that employers are permitted to offer workers
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Buffer stock
A scheme intended to stabilise the price of a commodity by buying excess supply in periods when supply is hig, and selling when supply is low
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Prohibitation
An attempt to prevent the consumption of a demerit good by declaring it illegal
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Hypothecation
Hypothecation is a situation in which an individual or company borrows money in relation to specific assets that become the property of the lender if the loan cannot be paid back
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Other cards in this set

Card 2

Front

Indirect tax

Back

A tac levied on expenditure on goods r services (as opposed to a direct tax, which is a tax charged directly to an individual based on a component of income)

Card 3

Front

Specific tax

Back

Preview of the front of card 3

Card 4

Front

Incidence of a tax

Back

Preview of the front of card 4

Card 5

Front

Ad valorem tax

Back

Preview of the front of card 5
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