Details

Title: AP Econ Ch 15 Vocab

Description: Extending the Analysis of Aggregate Supply

Total Flash Cards: 9

Created: 01/07/2010 16:08:26

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Term
Short Run
 Definition
a period in which nominal wages (and other input prices) do not respond to price-level changes.
Term
Long Run
 Definition
the period in which nominal wages are fully responsive to previous changes in the price level.
Term
Phillips Curve
 Definition
a curve that suggests an inverse relationship between the rate of inflation and the rate of unemployment.
Term
Stagflation
 Definition
Inflation accompanied by stagnation in the rate of growth of output and an increase in unemployment in the economy; simultaneous increases in the inflation rate and the unemployment rate.
Term
Aggregate Supply Shocks
 Definition
Sudden, large changes in resource costs that shift an economy's aggregate supply curve.
Term
Long-run vertical Phillips Curve
 Definition
The Phillips Curve after all nominal wages have adjusted to changes in the rate of inflation; a line emanating straight upward at the economy's natural rate of unemployment.
Term
Disinflation
 Definition
A reduction in the rate of inflation
Term
Supply-side Economics
 Definition
A view of macroeconomics that emphasizes the role of costs and aggregate supply in explaining inflation, unemployment, and economic growth
Term
Laffer Curve
 Definition
A curve relating to government tax rates and tax revenues and on which particular tax rate (between zero and 100 percent) maximizes tax revenues.