Edexcel (A) A Level Economics All Definitions

A comprehensive set of fill-in-the-blank flashcards covering key definitions from Themes 1 through 4 of the Edexcel (A) A Level Economics syllabus.

A tax that changes depending on the value of the thing being taxed is an __________.

Ad valorem tax

__________ occurs when one person in a deal knows more than the other, often leading to unfair outcomes.

Asymmetric information

The Latin phrase __________ is a fancy way of saying “everything else stays the same.”

Ceteris paribus

__________ measures how much the demand for one thing changes when the price of another thing changes.

Cross elasticity of demand (XED)

How much people want to buy something at a certain price is defined as __________.

Demand

The concept of __________ suggests that the more you have of something, the less excited you are about getting more.

Diminishing marginal utility

A graph showing the maximum possible production when using all resources efficiently is the __________.

Production possibility frontier (PPF)

__________ refers to how confident business owners feel about the economy.

Animal Spirits

A starting year for comparing data is known as a base year and is always given an index value of __________.

$$100$$

The official measure of inflation, tracking changes in the price of everyday goods, is the __________.

Consumer Price Index (CPI)

Anyone working at least __________ hour per week for pay, or in unpaid work for their family business, is considered employed.

$$1$$

Economic growth driven by increased sales to other countries is known as __________.

Export-Led Growth

Short-term joblessness when people are between jobs is called __________.

Frictional Unemployment

When an increase in spending leads to a larger increase in national income, this is known as the __________.

Multiplier Effect

When society gets the most benefit and resources are used in the best way possible, the market has achieved __________.

Allocative Efficiency

When two completely unrelated businesses merge, such as a clothing company buying a tech firm, it is called __________.

Conglomerate Integration

Demand for one product that depends on another, such as steel demand increasing because of car production, is __________.

Derived Demand

The __________ occurs when managers make decisions that do not always benefit the owners.

Principal-Agent Problem

When a business earns more than the minimum needed to stay in the market, it is making __________.

Supernormal Profit

When people do not have enough money for basic needs, defined as living on less than __________, they are in absolute poverty.

$1.90$ per day

A theory that says economic growth depends on savings and investments is the __________.

Harrod-Domar Model

The development of a country measured through income, health, and education is tracked by the __________.

Human Development Index (HDI)

The __________ describes a situation where a country’s trade balance gets worse before improving after a currency depreciation.

J-Curve

A scale showing that raising taxes too much can actually reduce government revenue is the __________.

Laffer Curve

A graph that shows how income is distributed in a country is a __________.

Lorenz Curve