Glossary - Construction Economics: A New Approach - page 306

marginal revenue (MR) The change in total revenues resulting from the sale of an
additional unit of a product.
market An abstract concept concerning all the arrangements that individuals have
for exchanging goods and services with one another. Economists often study
the market for particular goods and service, such as the labour market, the
car market, the commercial property market, the housing market, the building
materials market, the credit market, and so on.
market-based instruments These involve various incentive systems designed to
operate through the price mechanism to encourage environmentally friendly
behaviour. Examples include the climate change levy and the landfill tax.
market-clearing price Another term for equilibrium price.
market economy An economy in which prices are used to signal the value of
individual resources to firms and households.
market failure A situation in which the free forces of supply and demand lead to
either an under- or over-allocation of resources to a specific economic activity.
market mechanism See market economy and price mechanism.
market structures The characteristics of a market which determine the behaviour
of participating firms, such as the number of buyers and sellers and the ease of
entry into (and exit from) a market.
market supply schedule A set of numbers showing the quantity supplied at various
prices by the firms comprising the industry. The horizontal summation at each
price suggests the market supply.
mass balance model This model provides a framework to describe the relationships
between the economy and the environment by focusing on natural resource
depletion and pollution.
maximum price legislation A price ceiling set by a government agency specifying a
level in a specific market beyond which prices must not rise.
menu costs The resources used up revising contracts due to inflation.
merit good A product or service that is deemed socially desirable by politicians. If
left to the private market, merit goods may be under produced.
mesoeconomics A study of economic activities at the level of sectors or industries.
microeconomics The study of economic behaviour of individual households and
firms and how prices of goods and services are determined.
midpoint method A mathematical technique used for estimating elasticity. It
involves calculating percentage changes in price and quantity compared with the
average of the initial and final values.
minimum efficient scale The lowest rate of output at which long-run average costs
reach their minimum point.
mixed economy An economic system in which decisions about how resources are
used are made partly by the private sector and partly by the government.
mobility of labour The ease with which labour can be transferred from one type
of employment to another. Mobility of labour is considered in terms of
geographical and occupational mobility. The converse concept, the immobility
of labour, is often employed by economists.