Market Structures
what is market structure
the organization of a market, based mainly on the degree of competition
what is Craft Union
Labor union whose members perform the same kind of work.
what is Payroll withholding system
A system that requires an employer to automatically deduct income taxes from a workers paycheck and send them to the IRS
what is public sector
that part of the economy made up of local, state, and federal governments
what is Financial Markets
A market in which financial assets (securities) such as stocks and bonds can be purchased or sold. Funds are transferred in financial markets when one party purchases financial assets previously held by another party.
what is market failure
situation in which the market fails to allocate resources efficiently
what is Industrial Union
Labor union whose members perform different kinds of work in the same industry.
what is sin tax
A relatively high tax designed to raise revenue and discourage consumption of a socially undesirable product.
what is private sector
that part of the economy made up of private individuals and businesses
Role of Financial Markets
Transfer funds from those who have excess funds to those who need funds.
Accommodating Corporate Finance Needs: The financial markets serves as the mechanism whereby corporations (acting as deficit units) can obtain funds from investors
characteristics of market structures
- many producers and consumers
- identical products
- easy entry into the market
- no control over prices
what is a Company Union
Union organized, supported, or run by an employer.
what is property tax
Tax on tangible and intangible possessions such as real estate, buildings, furniture, stocks, bonds, and bank accounts.
Federal government spending increased dramatically starting when?
Great Depression
because the federal government took a larger role in everyday economic affairs, and
because Franklin D. Roosevelt's New Deal
what is Deficit Units
Participants who spend more money than they receive, such as borrowers
How do highly competitive markets benefit consumers?
-prices are lower
-products reflect costs more accurately
-more sellers to offer a product (variety of choices)
what is Wage Rate
Prevailing pay scale for work performed in an occupation.
what is individual income tax
Tax levied on the wages, salaries, and other income of individuals.
The government spends its revenue on
1. goods and services, and
2. transfer payments
what is Liquidity
Degree to which securities can easily be sold without loss of value.
What are the two types of competitions that break off from highly competitive markets?
Perfect (Pure) competition and monopolistic competition
what is Minimum Wage
Lowest-Legal wage that can be paid to most workers.
what is payroll taxes
tax on wages and salaries to finance social security and medicare costs
Government spending has a direct impact on
our economy. It:
1. affects resource allocation
2. redistributes income
3. competes with the private sector
4. increases the tax burden
what is Money Market Securities
Facilitate the sale of short-term debt securities by deficit units to surplus units. Debt securities that have a maturity of one year or less.