Ap Macro Ch. 10-12 Vocab

Front 1

wealth

Back 1

an abundance of valuable possessions or valuables

Front 2

value-added tax

Back 2

A tax on the amount by which the value of an article has been increased at each stage of its production or distribution

Front 3

unplanned inventory

Back 3

accumulation of products by the supplier due to over production or decreases in demand

Front 4

transfer payment

Back 4

A payment made or income received in which no goods or services are being paid for, such as a benefit payment or subsidy

Front 5

spending multiplier

Back 5

the idea that an initial amount of spending grows geometrically through the economy by a certain scale as some is saved and more is spent

Front 6

savings

Back 6

The money one has saved, esp. through a bank or official scheme.

Front 7

saving function

Back 7

The relationship between saving and disposable income

Front 8

saving

Back 8

An economy of or reduction in money, time, or another resource.

Front 9

recessionary gap

Back 9

The GDP gap or the output gap is the difference between potential GDP and actual GDP or actual output

Front 10

progressive tax

Back 10

any tax in which the rate increases as the amount subject to taxation increases.

Front 11

planned inventory

Back 11

purposeful stockpiling of inventory by suppliers in expectations of the future

Front 12

national debt

Back 12

total amount of money that a country's government has borrowed, by various means.

Front 13

marginal propensity to save

Back 13

efers to the increase in saving (non-purchase of current goods and services) that results from an increase in income

Front 14

marginal propensity to import

Back 14

refers to the change in import expenditure that occurs with a change in disposable income (income after taxes and transfers).

Front 15

marginal propensity to consume

Back 15

an empirical metric that quantifies induced consumption, the concept that the increase in personal consumer spending (consumption) that occurs with an increase in disposable income (income after taxes and transfers)

Front 16

macroeconomic equilibrium

Back 16

A situation in which the quantity of real GNP demanded equals the quantity of real GNP supplied.

Front 17

leakages

Back 17

amounts of money that are lost in transactions through savings

Front 18

injections

Back 18

amounts of money that is extra added to the economy to make up for small gaps in the GDP, usually added by the government

Front 19

dissaving

Back 19

The action of spending more than one has earned in a given period

Front 20

discretionary fiscal policy

Back 20

A fiscal policy achieved through government intervention, as opposed to automatic stabilizers

Front 21

direct taxes

Back 21

A tax, such as income tax, that is levied on the income or profits of the person who pays it, rather than on goods or services.

Front 22

crowding out

Back 22

concept where increased public sector spending replaces, or drives down, private sector spending

Front 23

consumption function

Back 23

a single mathematical function used to express consumer spending

Front 24

capacity utilization

Back 24

refers to the extent to which an enterprise or a nation actually uses its installed productive capacity

Front 25

budget surplus

Back 25

amount by which revenues exceed expenditures in a given time frame; most notably in government

Front 26

budget deficit

Back 26

amount by which expenditures exceed revenues in a given time frame; most notably in government

Front 27

autonomous consumption

Back 27

used to describe consumption expenditure that occurs when income levels are zero

Front 28

automatic stabilizer

Back 28

a tool to dampen fluctuations in real GDP without any explicit policy action by the government.

Front 29

aggregate expenditures

Back 29

current value of all the finished goods and services in the economy

Front 30

aggregate demand

Back 30

total demand for final goods and services in the economy at a given time and price