Econ Prt 2 (Test 2)

Front 1

Logrolling

Back 1

the exchange of votes by legislators, usually in order to gain support for particular legislation

Front 2

Interest groups

Back 2

collections of individuals with one or more common characteristics, such as occupation, who seek collectively to affect legislation or government policy so as to benefit members of the group.

Front 3

Elasticity

Back 3

a measure of the relative responsiveness of one variable to a change in another variable.

Front 4

Price elasticity of demand

Back 4

a measure of buyers’ relative responsiveness to a price change.

Front 5

Total expenditures

Back 5

the total amount spent by consumers on a good or service; calculated as equilibrium price times equilibrium quantity

Front 6

Total revenues

Back 6

total receipts of businesses; always equal to total expenditures by consumers.

Front 7

Income elasticity of demand

Back 7

a measure of consumers’ relative responsiveness to income changes; the percent change in quantity demanded divided by the percent change in income, holding price constant.

Front 8

Elasticity of supply

Back 8

a measure of producers’ or workers’ relative responsiveness to price or wage changes.

Front 9

Utility

Back 9

a measure of the satisfaction that the consumption of goods or services yields an individual.

Front 10

Principle of diminishing marginal utility

Back 10

the more of a good or service being consumed, the smaller is the marginal utility obtained by consuming one additional unit of the good or service, all other things equal.

Front 11

Marginal utility

Back 11

the amount by which total utility changes when consumption of a good or service changes by one unit; calculated by dividing the change in total utility by the change in quantity consumed

Front 12

Total utility

Back 12

the total amount of satisfaction derived from consuming any given quantity of a good or service

Front 13

Consumer equilibrium

Back 13

a situation in which a consumer chooses quantities of goods that maximize total utility given a budget constraint.

Front 14

Nominal income

Back 14

income measured in terms of money; not in terms of what money can buy

Front 15

Real income

Back 15

the buyer power of a consumer’s budget; determined by the consumer’s money income and the prices of goods and services.