Principles of Economics- Mankiw (5th) 789

Principles of Economics- Mankiw (5th) 789 - G L O S S A RY...

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real variables —variables measured in physical units recession —a period of declining real incomes and rising unemployment regressive tax —a tax for which high- income taxpayers pay a smaller fraction of their income than do low-income taxpayers reserve ratio —the fraction of deposits that banks hold as reserves reserve requirements —regulations on the minimum amount of re- serves that banks must hold against deposits reserves —deposits that banks have received but have not loaned out rivalry —the property of a good whereby one person’s use dimin- ishes other people’s use sacrifice ratio —the number of percent- age points of annual output lost in the process of reducing inflation by 1 percentage point scarcity —the limited nature of soci- ety’s resources shoeleather costs —the resources wasted when inflation encourages people to reduce their money holdings shortage —a situation in which quan- tity demanded is greater than quantity supplied stagflation —a period of falling output and rising prices stock —a claim to partial ownership in a firm store of value —an item that people can use to transfer purchasing power from the present to the
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