Term
|
Definition
| try to describe how the world works (testable) |
|
|
Term
|
Definition
| is a claim of how the world works (value judgement) |
|
|
Term
|
Definition
| when price change moves the consumer to a different indifference curve |
|
|
Term
|
Definition
| Buy less of more expensive goods, moves along an indifference curve. |
|
|
Term
|
Definition
Price Decreases, Quatity demand increases
Price Increase, Quatity demand decreases |
|
|
Term
|
Definition
| Price and Quantity supplied are directly related |
|
|
Term
|
Definition
| Percent change in quantity over percent change in price |
|
|
Term
|
Definition
o IED = % change QD / % change income
o IED < 0 = inferior
o IED > 0 = normal |
|
|
Term
|
Definition
o CPED = % change quantity of good A/ % change in price of good 2
o CPED < 0 = Goods are complements
o CPED > 0 = Goods are substitutes |
|
|
Term
|
Definition
o PES > 1 = elastic
o PES =1 = unit elastic
o 0 < PES < 1 = inelastic |
|
|
Term
|
Definition
- (--) Sign = complements (CPED) and inferior goods (IED)
- (+) Sign = substitutes (CPED) and normal goods (IED) |
|
|
Term
|
Definition
| More producers, fewere consumers because of higher price |
|
|
Term
|
Definition
|
|
Term
|
Definition
| How the burden of tax is distributed among the various people make up the economy |
|
|
Term
| Tax burden falls heavier on the side of the market... |
|
Definition
|
|
Term
|
Definition
| reduction in consumer and producer surplus resulting from a tax exceeds the revenue raised by the government. |
|
|
Term
| Average Tax Rate and Marginal |
|
Definition
| Average is up to a limit, then marginal is anything above that. |
|
|
Term
|
Definition
| Same cash amount for everyone. |
|
|
Term
|
Definition
| People should pay based on the benefits they recieve |
|
|
Term
| Vertical Equity and Horizontal |
|
Definition
| Verticle: Taxpayers with a greater ability to pay taxes should contribute larger Horizontal: taxpayers with similar abilities pay same amount |
|
|
Term
| Regressive vs Progressive |
|
Definition
| Regressive = Less Percentage for the rich Progressive = less percentage for the poor |
|
|
