Barriers to entry | ||||||||||
Definition: Obstacles to the entry of new firms into a market. Barriers to entry may take various forms. They may be technical barriers, legal barriers or barriers that arise from strong branding of the product.
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Purchasing power parity
A method for calculating the correct value of a currency, which may differ from its current market value. It is helpful when comparing living standards in different countries, as it indicates the appropriate EXCHANGE RATE to use when expressing incomes and PRICES in different countries in a common currency.
Protectionism
Opposition to FREE TRADE. Although intended to protect a country’s economy from foreign competitors, it usually makes the protected country worse off than if it allowed international trade to proceed without hindrance from trade barriers such as QUOTAS and TARIFFS.
Public goods
Things that can be consumed by everybody in a society, or nobody at all. They have three characteristics. They are:
• non-rival – one person consuming them does not stop another person consuming them;
• non-excludable – if one person can consume them, it is impossible to stop another person consuming them;
• non-rejectable – people cannot choose not to consume them even if they want to.