Economics Micro & Macro (CliffsAP)

public goods:Goods and services available to the whole society.

public goods rationale:The argument that some public goods can be produced more efficiently by social choice.

public institutions:Publicly owned organizations established by government to serve the wants and needs of a whole

society.

public sector:The part of an economy that is owned by and operated for the benefit of the whole society.

pure oligopoly:An oligopoly in which the products are the same for all firms.

Q

quota:A limit on the amount of imports or exports.

R

range:The largest number in a distribution minus the smallest number.

rate of growth:The percentage change in the level of economic activity from one year to the next.

rates:An indication of how quickly absolute numbers are changing.

ratio:A way of showing the proportion between numbers.

real GNP:The value of the gross national product after eliminating the effect of price changes.

real GNP per person:The real value of the total output of goods and services divided by the number of people in the

economy.

real value:A nominal value that has been adjusted for changes in prices.

recession:The condition in which unemployment is high and GNP falls for two or more quarters.

redistributing income:In an effort to provide equity, the public sector gives to people who do not work money

collected from taxing the incomes of those who do work.

regressive tax:A tax that takes a larger percentage of lower incomes and a smaller percentage of higher incomes.

research and development (R&D):The activities undertaken to find new and more efficient methods of production.

reserve ratio:The fraction of deposits that the Federal Reserve determines banks must keep on reserve.

reserve requirement:The dollar amount banks must keep on reserve.

restrictive fiscal policies:Fiscal policies that cause the economy to run more slowly by reducing aggregate demand.

returns to scale:The relationship between changes in scale of production and changes in output.

S

sales tax:A tax on goods that are purchased.

savings and loan association:A financial intermediary that mainly provides a place for people to save money and then

lends that money to people to purchase houses or other things.

CliffsAP Economics Micro & Macro

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