Details Title: ch 10-12 Description: review Total Flash Cards: 37 Created: 12/06/2008 19:16:17		New Users: To study from this flashcard set, or to create your own your own study flash cards, REGISTER HERE. Existing Users: CLICK HERE. Additional Economics Flashcards
Cards in this set: Term marginal product of labor Definition the change in output from one additional unit of labor Term marginal principle Definition increase in the level of an activity as long as its marginal benefit exceeeds its marginal cost. choose the level at which the marginal benefit equals the marginal cost Term marginal revenue product of labor (mrp) Definition the extra revenue generated from one additional unit of labor ; mrp is equal to the price of output times the marginal product of labor Term short run demand curve for labor Definition a curve showing the relatioship between the wage and the quantity of labor demanded over the short run, when the firm cannot change its production facility Term long run demand curve for labor Definition a curve showig the relationship between the wage and the quantity of labor demanded over the long run, when the number of firms can modify their production facilities Term output effect Definition the change in the quantity of labor demanded resulting from a change in the quantity of output produced Term input substitution effect Definition the change i nthe quantity of labor demanded resulting form an increase in the price of labor relative to the price of other inputs Term substitution effect for leisure demand Definition the change in leisure time resulting from a change in the wage ( the price of leisure) relative to the price of other goods Term income effect for leisure demand Definition the change in leisure time resulting from a change in real income caused by a change in the wage Term market supply cuve for labor Definition a curve showing the relationship between the wage and the quantity of labor supplied Term learing effect Definition the increase in a person's wage resulting from the learning of skills required for certain occupations Term signaling effect Definition the information about a person's work skills conveyed by completing college Term means tested program Definition a government spending program that provides assistance to those whose income falls below a certain level Term macroeconomics Definition the study of the nation's economy as a whole; focuses on the issues of inflation, unemployment, and economic growth Term inflation Definition sustained increases i nthe average prices of all goods and sevices Term gross domestic product (GDP) Definition the total market value of final goods and services produced within an economy in a given year Term intermediate goods Definition goods used in the production process that are not final goods and services Term real GDP Definition a measure of GDP that controls for changes in prices Term nominal GDP Definition the value of GDP on current dollars Term economic growth Definition sustained increases in the real GDP of an economy over a long period of time Term comsumption expenditures Definition purchases of newly produced goods and services by households Term private investment expenditures Definition purchases of newly produced goods and services by firms Term gross investment Definition total new investment expenditures Term depreciation Definition deduction in the value of capital goods over a one year period due to physical wear and tear and also to obsolescence; also called capital consumption allowance Term net investment Definition gross investment minus depreciation Term government purchases Definition purchases of newly produced goods and services by local, state and federal governments Term transfer payments Definition payments form government to individuals that do not correspond to the production of goods and services Term import Definition a good produced in a foreign country and pruchased by residents of the home country (ex, US) Term export Definition a good produced in the home country and sold in another country Term net exports Definition exports minus imports Term trade deficit Definition the excess of imports over exports Term trade surplus Definition the excess of exports over imports Term national income Definition the total income earned by a nation's residents both domestically and abroad i nthe production of goods and services Term gross national product Definition GDP plus net income earned abroad Term personal income Definition income, including transer payments, received by households Term personal disposable income Definition personal income that households retain after paying taxes Term value added Definition the sum of all the income- wages, interest, profits, and rent- generated by an organization. for a firm, we can measure value added by the dollar value of the firm's sales minus the dollar value of the goods ad services purchasd from other firms