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16 Cards in this Set

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indirect tax on demerit good

Norway tobacco tax

(2017) Cigarettes - NOK 2.55 per item


Norway tax break on electric cars

(2014) total of 16 910 euro per vehicle

(2017) 37% of cars on the road in Norway are electric. and increase from 29% in 2016.

price control

- only effective measures on extremely short-term basis. Over the long term, price controls lead to problems such as shortages, rationing, deterioration of product quality and black markets that arise to supply the price-controlled goods

- the United States is the price controls set on gasoline established during the Nixon administration, which eventually led to major shortages in supply and long, slow lines at gas pumps.

Perfect competition



- Providers of water, natural gas, telecommunications, and electricity are usually granted exclusive rights to service cities through local governments

Monopolistic competition

The restaurant business


- The auto industry with the leading auto manufacturers in the United States being Ford, GMC and Chrysler.

Price discrimination

The travel industry: Travel products and services are marketed to specific social segments. Prices fluctuate based on time of travel (time of day, day of the week, time of year).

- First degree - the seller must know the absolute maximum price that every consumer is willing to pay.

- Second degree - the price of the good or service varies according to quantity demanded.

- Third degree - the price of the good or service varies by attributes such as location, age, sex, and economic status.

Negative externality of production

Burning fossil fuels

- release nitrogen oxides into the atmosphere, which contribute to the formation of smog and acid rain. Major sources of nitrogen oxide emissions are coal-fired power plants.

- Threatens sustainability

Negative externality of consumption

Food miles

purchasing food that is not in season

In 2005, the import of fruits, nuts, and vegetables into California byairplane released more than 70,000 tons of CO2, (

Common access resources

tragedy of the commons

Fishing grounds
- over-consumption, degradation and depletion

Cap and trade systems

-Verified emissions of greenhouse gases from stationary installations amounted to 1800 million tonnes of CO2-equivalent in 2015. These emissions were about 0.37% below the 2014 level

Household indebtness

Total, % of net disposable income, 2015

- Denmark had the largest with 292 % of net disposable income

Fiscal policy


increased government spending --> American Recovery and Reinvestment Act of 2009. during the Great Recession, totaled $831 billion. Most of this spending targeted infrastructure, education and extension of unemployment benefits.

monetary policy


supply side policies