Fundamentals
The value of the next best alternative that must be given up. (Related to trade-offs.)
What is opportunity cost?
When quantity supplied exceeds equilibrium, there is a _______________.
What is a surplus?
This is the lowest point of the business cycle.
What is a trough?
This is what GDP stands for.
What is Gross Domestic Product?
This type of tax increases as the income of the payer increases.
What is progressive?
The idea that human wants will always exceed resources (unlimited wants and limited resources).
What is scarcity?
The point where supply and demand meet.
What is equilibrium?
This is the highest point in the business cycle.
What are peaks?
This measures a population's ability to buy and do things that it needs and wants to do.
What is Standard of Living?
This tax takes a higher proportion from taxpayers with lower incomes than taxpayers with higher incomes.
What is a regressive tax?
These are the four major economic systems.
What is Market, Mixed, Traditional, and Command?
Goods that we need and that don't have a replacement -- like gasoline -- are considered this type of good. (Think rubber bands.)
Inelastic goods.
Name one thing that happens in the economy during an expansion.
What is interest rates are low; people take out loans and spend money; companies invest in capital.
This economic indicator measures a basket of goods, and is used to determine inflation from one year to the next.
What is the Consumer Price Index?
Sales tax is considered this type of tax.
What is regressive?
The three main questions all economies must answer.
What is What to produce, how to produce it, and for whom will we produce ?
Goods that are usually bought together and compliment each other -- like a tent and a sleeping bag -- are this.
What are complements / complementary goods?
Name one thing that happens during a contraction.
What is interest rates go up; people spend less money; companies invest less in capital.
This is one of two things that is NOT factored into the unemployment rate.
What are discouraged workers and the underemployed?
Income tax is considered this type of tax.
What is progressive?
These are the two major types of capital.
What are human and physical?
Name two events that would cause a shift in the demand curve.
What is a change in tastes, a change in population, the availability of substitutes, etc.
This is the last time we had an economic event that took us out of the business cycle.
What is the 2008 recession?
What is the best version of GDP to compare across nations and time periods?
What is real GDP per capita?
This is the current income tax percentage for the highest earners.
What is 39%?