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16 Cards in this Set
- Front
- Back
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Perfectly inelastic...
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0
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Inelastic
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<1
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Unit Elastic
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1
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Elastic
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> 1
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Perfectly Elastic
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Infinity
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When close substitutes are available...
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Elasticity is higher
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For broadly defined goods...
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Elasticity is lower than narrowly defined goods
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For luxuries...
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Elasticity is higher
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Elasticity is higher in the ______ run
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Long
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Negative cross-price elasticity means the goods are...
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Complements
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Positive cross-price elasticity means the goods are...
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Substitutes
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The rationing mechanism in a free market is...
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Price
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Internalizing the externality means
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To altern incentives so that people take account of the external effects of their actions
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Total surplus =
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value to buyers - costs of sellers
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Workers determine ____ of labor, firms determine ____ of labor
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supply, demand
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Luxury tax...
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Larger part of the tax burden fell on sellers & middle class, wealthy demanded fewer luxury goods, it was repealed/modified
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