ability-to-pay principle —the idea that taxes should be levied on a person according to how well that person can shoulder the burden absolute advantage —the comparison among producers of a good accord-ing to their productivity accounting profit —total revenue mi-nus total explicit cost aggregate-demand curve —a curve that shows the quantity of goods and services that households, firms, and the government want to buy at each price level aggregate-supply curve —a curve that shows the quantity of goods and services that firms choose to pro-duce and sell at each price level appreciation —an increase in the value of a currency as measured by the amount of foreign currency it can buy automatic stabilizers —changes in fis-cal policy that stimulate aggregate demand when the economy goes into a recession without policymak-ers having to take any deliberate action average fixed cost —fixed costs divided by the quantity of output average revenue —total revenue divided by the quantity sold average tax rate —total taxes paid divided by total income average total cost —total cost divided by the quantity of output average variable cost —variable costs divided by the quantity of output balanced trade —a situation in which exports equal imports benefits principle —the idea that peo-ple should pay taxes based on the
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This note was uploaded on 08/01/2010 for the course ECON 120 taught by Professor Abijian during the Spring '10 term at Mesa CC.