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100
an excess of government spending over government receipts
What is budget deficit
100
an excess of government receipts over government spending
What is budget surplus
100
total tax paid divided by total income
How to calculate average tax rate?
100
the amount that taxes increase from an additional dollar of income
What is marginal tax rate?
100
a tax that is the same amount for every person
What is lump-sum tax
200
the idea that people should pay taxes based on the benefits they receive from government services
What is benefit principle
200
the idea that taxes should be levied on a person according to how well that person can shoulder the burden
What is ability to pay principle
200
the idea that taxpayers with a grater ability to pay taxes should pay larger amounts
What is vertical equity
200
the idea that taxpayers with similar abilities to pay taxes should pay the same amount
What is horizontal equity
200
a tax for which high income and low income taxpayers pay the same fraction of income
What is proportional tax
300
a tax for which high income taxpayers pay a smaller fraction of their income than do low income taxpayers
What is regressive tax
300
a tax for which high income taxpayers pay a larger fraction of their income than do low income taxpayers
What is progressive tax
300
a legal maximum on the price at which a good can be sold
What is price ceiling
300
a legal minimum on the price at which a good can be sold
What is price floor
300
the manner in which the burden of a tax is shared among participants in a market
What is tax incident
400
input cost that require an outlay of money by the firm
What is explicit cost
400
input costs that do not require an outlay of money by the firm
What is implicit cost
400
total revenue minus total cost, including both explicit and implicit cost
What is economic profit
400
total revenue minus total explicit cost
What is accounting profit
400
the relationship between quantity of inputs used to make a good and the quantity of output of that good
What is production function
500
the increase in output that arises from an additional unit of output
What is marginal product
500
the property whereby the marginal product of an input declines as the quantity of the input increases
What is diminishing marginal product
500
What is fixed cost and variable cost
fixed cost: costs that do not vary with the quantity of output produced variable cost: costs that vary with the quantity of output produced
500
What is efficient scale, economic of scale, diseconomies of scale, and constant returns to scale
efficient scale:the quantity of output that minimizes average total cost economies of scale: the property whereby long-run average total cost falls as the quantity of output increases diseconomies of scale: the property whereby long-run average total cost rises as quantity of output increases constant returns to scale:the property whereby long-run average total cost stays the same as the quantity of output changes
500
how to calculate average total cost and marginal cost?
average cost= total cost/quantity marginal cost=change in total cost/change in quantity