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20 Cards in this Set
- Front
- Back
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Why is the supply curve for labor upward sloping?
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Substitution Approach
- This is based on RATIONAL CHOICE - You substitute to work more because the price of leisure has increased. - The more leisure cost, the more you will work - Positively correlated: - The more leisure costs, the more you work. - The less leisure costs, the less you work. |
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Why is the supply curve of labor downward sloping?
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Income approach
- Downward sloping because the more you work the more income you make. - Therefore, people decide to work fewer hours when their pay increases because they're richer. - New job, raise, etc. |
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Are we concerned with before tax or after tax income?
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After Tax Income
- AFT = What you take home. - To determine how much we need to work, we need to be concerned with AFT. - AFT is what you give up by not working. - Therefore, as your marginal tax rate increases, your incentive to work decreases. - The effect on rich and poor is different. - Rich can change behavior easily. - This is much more difficult for the poor. |
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Why would some workers not want income taxes to be reduced?
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Membership in unions increased but ever since the 1960's they've weakened in number and size. Why?
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What is debt?
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Why should we look at not only debt but the debt/GDP ratio?
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Is running a budget deficit bad? Why and why not?
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From a purely economic point-of-view, what is the real problem and the real solution with the baby boomer effect?
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What are some ways to fix the problem in #9?
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While the government is trying to expand the economy, what are we accumulating in the process?
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What is the study of economics?
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From an objective economic view, what is a free market?
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How is Keynesian and Classical economics different?
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List the tools to control Aggregate Demand and which one is more effective?
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Due to the Great Recession, the economy was pushed to expand using monetary and fiscal policies. What are the negative consequences in the future from these policies?
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A shift in demographics could play havoc in an economy. For example, the Baby Boomer effect. What is the "real" problem and the "real" solution.
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From the IOUSA film, give some examples of actions that can be implemented to help.
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From our study, what is the best country used as an example with the least amount of government involvement but has one of the highest standards of living?
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What is the cash method of accounting and why is it important?
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