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104 Cards in this Set
- Front
- Back
Need
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something that you need to survive
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want
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something you necessarily don't need for survival but that you desire
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good
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physical good
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services
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doing something for someone else, providing assistance
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scarcity
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limited resources for unlimited wants
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factors of production
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land, labor, capital used to produce a good or service
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entrepeneur
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a risk taker who combines the factors of production to produce a good or service
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opportunity cost
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the most desirable thing that you give up when making a decision
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guns or butter
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a decision the govt makes to either produce more social or military goods
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thinking at marginq
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looking at whether one more thing is going to help or hurt the economy
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production possibilites graph
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using a graph to make sure that you are utilizing both resources
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economic system
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the way a society decides to distribute their goods and services
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factor payments
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payments for providing a factor of production
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safety net
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programs and services the govt provides to help people in need
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standard of living
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level where you have economic success
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market economy
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economy where the people sell and exchange goods and services
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centrally planned economy
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economy where the govt controls what & how much to make and how to sell it
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traditional economy
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rituals, habits and customs where you're the same thing all your life and your kids are the same thing
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mixed economy
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market economy, centrally planned economy, and traditional economy combined
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free enterprise
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idea that capitol goods should be privately owned by individuals or a corporation
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laissez-faire
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concept that govt shouldnt be involved in regulating & monitering business
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public interest
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concern of its people making sure interest of people are being looked after as a whole
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interest group
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privately owned organizations that look out for the public interest of the corporation
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public sector
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govt being involved in the economic system, the transactions of the govt
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private sector
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no govt interference; private corps producing goods and services for their own profit
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externality
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the side effect of producing a good or service
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business cycle
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ups & downs of economic world that explains what is happening & what will happen
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law of demand
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the more that we demand there will be a set quantity that the suppliers will have; the larger the demand, the lower the price
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substitution effect
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if prices go up & dont go down we suubstitute the product for something similar but cheaper
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income effect
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has an effect on demand; less income decreases demand; more income increse demand
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complements
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two goods that you have to buy together
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elastic
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if price goes up, demand changes significantly & you substitute
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inelastic
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a product that no matter what happens to the price, the demand for the product wont change
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law of supply
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the higher the price the more your willing to supply & the lower the price the less you willing to supply
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fixed cost
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price that doesnt change from month to month
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variable cost
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things that change in price from month to month
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total cost
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fixed cost and variable cost that it to makes the product
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operating cost
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cost it takes to operate a facility
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subsidy
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govt controlling one of the variable costs for the business
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excize tax
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discouraging supply, extra tax on a finished good or service
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price ceiling
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the maximum price on a finished good or service
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price floor
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the minimum price on a finished good or service
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perfect competition
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a number of different businesses produce the same product
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economies of scale
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cost of making an item will drop as you produce more
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monopoly
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one business/corp controls all aspects of producing a good or service
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oligopoly
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several companies working together to drive out competition
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trust
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several companies that come together to drive out competition
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anti-trust laws
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laws that limit & control businesses to create fair competition
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investment
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taking money & allocating it into an avenue that generates or saves moneyfor your future
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mutual fund
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pulls together the money of several investors & uses our money to buy stocks & bonds for that group of people
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security exchange commission
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monitor & police the transaction of the stock market
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savings bond
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way that the govt raises money
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bull market
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when the stock market is doing really well
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bear market
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when the stock market is doing bad
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dow jones
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an index of 30 corps; way of measuring how the stock market is doing
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s&p 500
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index of 500 of corps; larger and better measurements
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nasdaq
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more riskier than the other two; smaller index; more technological; more speculative
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sole propietorship
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business that is individually owned
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partnership
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when two or more people own a business
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liabilty
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legal binding to the debts that your business accumalates
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asset
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your possessions that you own of value; more assets you have the more money you're able to borrow
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corporation
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another type of business/org. owned by shareholders
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horizontal merger
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2 or more companies in the same industry merge
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vertical merger
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2 or more companies that merge together from different industries
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cooperative
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business org. owned & operated by a group of people seeking to benefit their own interest
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non-profit organization
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run & operated like any other business but not driven to gain any profits for personal gain
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union
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association of workers that work to gain better working conditions and wages
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strike
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workers of a union stop work
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right to work law
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states, counties, cities can create laws that make unions not mandatory
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unskilled labor
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labor that doesnt require any education or skills or technical training
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semi-skilled labor
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jobs that require some for of skill & education
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skilled labor
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something that requires training, apprentice program, education necessary
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professional labor
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highly educated, trained work force, college, master's degrees, phD's
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commodity money
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diamonds, cattle, gold, cole, anything that you can use to exchange goods & services
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representatives money
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an IOU
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fiat money
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the legal dollar bill and coins
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federal reserve system
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created a national set of 12 regional banks, responsible for holding money in reserve
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federal deposit insurance corp
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insures money in member banks up to $100,000
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wampum
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native american currency made out a conch & black mucle shelss, backbone for basis of our currency here in the US; connecticut set a value for these shells
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savings & loans crisis
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degregulation, more competition, high interest rates, and fraud were the causes; banks didnt have any money
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fractional reserve
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amnt of money that banks must keep in their vaults
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sales tax
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monetary value on a sold good or service
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property tax
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monetary amnt that home owners pay based on the value of their home
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corporate income tax
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tax copr. pay on their profits shareholders also pay
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estate tax
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looking at your worth, home, all your valuable things; a way of making sure the govt puts a tax on it
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gift tax
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a way of not paying taxes; you can be given a large amnt of money & not hav to pay taxes; up to $10,000
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FICA
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federal insurance contribution act; funding medicare & social security; we all pay these taxes
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mandatory spending
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govt has to fund or spend money on, medicare & social security
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discretionary spending
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govt spending/funding as what they think is fit; education & defense
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gross domestic product (GDP)
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the dollar value of all final goods & services w/in a country's border
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intermediate goods
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products used to make a final good for GDP
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durable goods
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things that are made that last a long period of timee for GDP
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nondurable goods
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products that dont last a long time
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nominal GDP
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measuring GDP from yr 1 to yr 2 using current prices
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real GDP
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measuring GDP from yr1 to yr 2 using constant prices
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frictional unemployment
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taking the time to find a job, best job possible
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seasonal unemployment
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people that choose careers that deal with seasons & when the season ends they dont work
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structural unemployment
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your skills/education doesnt keep up w/ your jobs demands or over-qualify
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cyclical unemployment
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deals w/business cycle, lay offs businesses do during bad economic times
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full employment
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no unemployment do to cyclical means;
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under-employed
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part time workers who wish to be full time; or people who dont like where they work & what they do
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fiscal policy
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govts way of stabilizing economy through taxing and spending money
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expansionary policy
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lowering taxes & spending more money
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contractionary policy
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a way of getting money out of the economy & combating inflation & spend less
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