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INDUCED CHANGE: A change in aggregate expenditures, especially consumption expenditures, that is "induced" or triggered by a change in national income or gross domestic product. Induced changes form the foundation for the multiplier effect, which is set in motion by autonomous changes in aggregate expenditures. In terms of Keynesian economics and the Keynesian cross diagram, induced changes are seen as a movement along in the aggregate expenditures line. This two step process, autonomous changes causing induced changes, is key to explaining business cycle fluctuations.
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                           ALLOCATIVE EFFICIENCY: Obtaining the most consumer satisfaction from available resources. In other words, resources are allocated in such a way that consumer satisfaction is at its highest possible level. This is also termed either efficiency or economic efficiency. Allocative efficiency means the economy is doing the best job possible of satisfying unlimited wants and needs with limited resources--that is, of addressing the problem of scarcity. To achieve allocative efficiency, however, the economy must first achieve technical efficiency. Technical efficiency means that society is getting the most production from available resources. In other words, there is no waste in the production process.Allocative efficiency, however, means that this technically efficient production is also useful to or valued by people. While technical efficiency might be achieved in the production of purple spotted stuffed animals, allocative efficiency is not achieved if no one actually wants purple spotted stuffed animals and they remain stored in a big purple warehouse.
Recommended Citation:ALLOCATIVE EFFICIENCY, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2019. [Accessed: August 23, 2019].
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BROWN PRAGMATOX
[What's This?]
Today, you are likely to spend a great deal of time touring the new suburban shopping complex trying to buy either a green fountain pen or a handcrafted bird house. Be on the lookout for spoiled cheese hiding under your bed hatching conspiracies against humanity.
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There were no banks in colonial America before the U.S. Revolutionary War. Anyone seeking a loan did so from another individual.
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"Be a yardstick of quality. Some people aren't used to an environment where excellence is expected. " -- Steve Jobs, Apple Computer co-founder
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TGE
Tokyo Grain Exchange (Japan)
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