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Definitions |
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underproduction
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shortage
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WL
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Wage*Labor or Labor Cost
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trade price
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calculated by using inputs
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redistribution
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reducing inequalities in income through such measures as progressive income taxation and antipoverty programs
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Total Utility
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measureof the satisfaction the consumer derives from consumption of goods and services
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reunified Germany
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rising unemployment rates have resulted in a right-wingo neo-Nazi resurgence
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Monopoly
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One seller, and seller controls price
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Trademarks
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Designs and names by which products are designated and differentiated
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Continuum
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range with no clear divisions of economic systems
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Decrease the money supply
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The Fed sells bonds
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computer simulation
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Use of computer software and workstations or sophisticated desktop computers to create outcome scenarios
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Business Cycle
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Fluctuations in economic activity such as employment and production
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elastic
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relatively responsive to change, as to a proportionate increase in demand as the result of a decrease in price
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Economics
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The study of how people and societies use limited resources to satisfy their unlimited wants. The study of scarcity and choice
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Savings equation
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Savings = domestic investments + Net Capital outflow
NCO = NX
S = I + NX
S = I + NCO
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Menshevik
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of the moderate wing of the Russian Social Democratic Party, followers were social reformers similar to those of Western Europe(Stalin, Bolshevik, Lenin, Menshevik, Trotsky)
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A farm is able to produce 5,000 bushels of peaches per season on 100 acres. Assume it adds one more acre and is able to produce 6,000 bushels per season. The marginal product of the additional acre of land for this farm is: a) 6,000 bushels per acre per y
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c
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Market Failure
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When government has intervened in the market to provide products or a service. When there is no equilibrium point (consumers and sellers can't agree on a price). Occurs when there's a 3rd party effect
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investment income
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money received in the form of dividends or interest
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collective bargaining
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the process by which wages, hours, rules, and working conditions are negotiated and agreed upon by a union with an employer for all the employees collectively whom it represents.
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1.4 trillion
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Dollars of gdp earned from us exports in 2006 (11 percent of gdp)
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recessionary gap
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the GDP gap (full employment GDP less the equilibrium GDP) divided by the aggregate expenditures multiplier
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production possibility table
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lists a choice’s opportunity cost by summarizing what alternative outputs you can achieve with your inputs
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inflation risk
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Danger that a general increase in the price level will undermine the real economic value of any legal agreement that involves a fixed promise to pay over an extended period
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The ability to produce a good or service at a lower opportunity cost compared to other producers
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Comparative Advantage
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Nominal GDP
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the value of final goods and services evaluated at current year prices
[Quantity x Prices = Nominal GDP]
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Define: Surplus
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when the asking price is greater than a market-clearing price
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in a market system innovators are rewarded by being able to earn large profits in the short term; such profits for successful innovations serve to direct research and development efforts toward those activities that are most valued by society
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Ample Incentives for Innovation
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citizens of former East Germany
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had no entrepreneurial class other than the owners of small businesses in a small private sector
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• What is Medigap insurance?
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Retirees not covered by Medicaid or their own retiree health insurance buy these policies from insurance companies. Basically Medi-gap insurance often covers medicare copays, this way Medicare is still incurring same costs, just individual isn’t paying copay, insurance company is.
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deflation
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a fall in the general price level or a contraction of credit and available money
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Terms of Trade
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The number of units of one good that exchange in the market for one unit of some other good.
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A truly voluntary exchange
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is hardly ever an exchange of equal values
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Define: Price Ceiling
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an action by the gov't to keep prices below the market prices
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inward / economic contraction
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If we have fewer productive resources or degrade technology, this will shift the PPC ______.This is called _____________.
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net exports of goods and services
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term that refers to the difference between the US exports and its imports
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bundling
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two or more products with a single bundled price
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At any particular quantity demanded, the height of the demand curve illustrates the “reservation price” of the buyer of that unit. At any particular quantity supplied, the height of the supply curve illustrates the “reservation price” of the sell
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Height of Demand or Supply curve as an illustration of Reservation Price
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an excise tax levied on producers in a constant cost competative industry will, in the long run,
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harm consumers but not producers who continue to operate.
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