The brand of economics that looks at the behaviour of individuals and businesses. In other words, it examines how consumers and businesses react to changes in variables. For example, how do consumers react to price changes and how does quality affect this decision making.
Oligopoly is derived from the Latin ‘olígoi’ – meaning “few”, and ‘pōléō’ – meaning “to sell”. So loosely translated, it means ‘few sellers’. This is a key characteristic of oligopolistic markets as it is defined by a few firms dominating the market.
A tariff is a tax that the government imposes on imported goods.
Supply and demand. Demand and supply. However you call it, they both interact with each other. So what is supply and demand? Simply put, supply and demand relates to the relationship between, the amount of products/services produced, the amount that people want, and the impact that has on prices.
Opportunity cost is the price we pay to take one action over another.
Adverse selection is where one individual in a transaction has more information about the good than the other.
The consumer surplus is the difference between what the consumer is willing to pay, and what they actually pay.
According to the Collins Dictionary, a free market is an economic system that allows supply and demand to regulate prices, wages, etc, rather than government policy. To be defined as a free market, government must not be involved at any point during the exchange. This means that there is no government intervention, whether in the form of subsidies, tariffs and quotas, or regulation.
