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31 Cards in this Set
- Front
- Back
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how the nation's income is apportion among wages rents interests and profits
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Functional Distribution of Income
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the nation's total income is divided among individual households
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Personal Distribution of Income
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one or more functions fabricating distributing goods and services
(factory farm mine store etc ) |
Plant
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organization the employs resources to produce goods for profit and operates one or more plants
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Firm
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group of firms that produce same or similar products
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Industry
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roducts with an espected life of les than 3 years
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Nondurable Goods
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work done for consumers
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Services
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products with an espected life of 3 or more years
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Durable Goods
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business owned and operated by one person
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Sole Proprietorship
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two or more people own and operate a business
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Partnership
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distinct and separate from the individual stockholders who own it hire managers run most
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Corporation
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shrea in the ownership of a corporation
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Stock
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does not bestow any corporate ownership on a purchaser
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Bond
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assets are not at stake if the corporation defaults on its debts
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Limited Liability
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wishes of mangers and agents don't always coincide
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Principal-agent problem
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controls an industry
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Monopoly
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welfare checks and food stamps
unemployed compensation payments |
Transfer Payments
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outsiders gain benefits from an economic decision
EX. Vaccination |
Positive Externalities
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pass some economicy activity costs onto others
EX. Pollution |
Negative Externalities
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when some of the costs of benefits of a good are passed on to someone other than the immediate buyer or seller
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Externalities
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non rival/ nonexclusive goods
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Public Goods
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people receive benefits without having to pay
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Free-Rider Problem
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education highways police and fire protection libraries museums
exclusion is possible |
quasi-public goods
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part of domestic (exhaustive)
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Gov. Purchases
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Federal tax system based on Income
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Personal Income Tax
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total tax paid divided by total taxable income
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Average Tax Rate
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rate the tax is paid on each addition unit of taxable income
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Marginal Tax Rate
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corporate profit is taxed usually 35%
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Corporate Income Tax
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social security contributions based on wages and salaries and Medicare
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Payroll Taxes
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taxes on a purchase
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Sales and Excise Taxes
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where local govt's make most of there revenue from
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Property Taxes
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