tax rate
the percentage that is levied on the valuer of whatever is being taxed, such as income or property
proportional tax
a tax that takes the same share of income at all income levels
progressive tax
a tax that takes a larger share of income as income increases
regressive tax
a tax that takes a smaller share of income as income increases
infrastructure
the basic physical and organizational structures and facilities needed for the operation of a society or enterprise
tax base
the thing that is taxed
flat tax
a tax system with a constant marginal rate, usually applied to individual or corporate income
tax code
a set of laws that govern federal taxes
withholding
employers take out a certain amount of tax from each paycheck
W-2 form
lists the wages from the previous calendar year and the amount of tax that was withheld
payroll tax
a tax on the wages a company pays its employees
social security tax
set at fixed rate, which is paid half by the employer and half by the employee
medicare tax
An employee's earnings that are subject to a U.S. payroll tax
property taxes
tax on the value of a property, usually levied on real estate
sales tax
levies a percent charge on the purchase of a wide variety of goods and services
excise taxes
taxes paid when purchases are made on a specific good, such as gasoline
sin taxes
a tax on items considered undesirable or harmful, such as alcohol or tobacco
luxury taxes
a tax placed on products or services that are deemed to be unnecessary or non-essential
federal deficit
shortfall between tax revenues and government expenditures
national debt
total amount owed money by a nation's government as a result of borrowing
fiscal year
a 12 month accounting period
mandatory spending
spending that is fixed by law
entitlements
programs through which individuals receive benefits based on their age, income, or some other criteria
discretionary spending
is government spending implemented through an appropriations bill
inflation
an increase in the overall price level of goods and services produced in an economy
economic indicators
statistics that help economist judge the health of an economy
gross domestic product (GDP)
the market value of all final goods and services produced within a country during a given period of time
unemployment rate
the percentage of the labor force that is not employed but is actively seeking work
inflation rate
the percentage of increase in the average price level of goods and services from one month or year to the next
consumer price index (CPI)
a measure of price changes in consumer goods and services
business cycle
a recurring pattern of growth and decline in economic activity over time
recession
a period of declining national economic activity for at least six months or longer
market value
the price consumers are willing to pay for a good or service in a competitive market place
final good
any new good that is ready for use by a consumer
intermediate goods
goods that are used in the production of final goods
net exports
the value of all exports minus all imports
nominal GDP
GDP evaluated at current market prices that will include all of the changes in market prices that have occurred during the current year due to inflation or deflation.
current dollars
value of a dollar without adjusting for the effect of inflation
real GDP
a macroeconomic measure of the value of economic output adjusted for price changes
constant dollars
fixed rate that was current in a specified base year
per capita GDP
nations real gross domestic product divided by its population
frictional unemployment
the unemployment which exists in any economy due to people being in the process of moving from one job to another
structural unemployment
unemployment resulting from industrial reorganization, typically due to technological change, rather than fluctuations in supply or demand
seasonal unemployment
occurs when people are unemployed at certain times of the year, because they work in industries where they are not needed all year round.
cyclical unemployment
a factor of overall unemployment that relates to the cyclical trends in growth and production that occur within the business cycle
natural rate of unemployment
a combination of frictional and structural unemployment that persists in an efficient, expanding economy when labor and resource markets are in equilibrium (4-6%)
discouraged workers
a person of legal employment age who is not actively seeking employment or who does not find employment after long-term unemployment
involuntary part-time workers
unable to find full-tie jobs, settle for part time employment
underground economy
people who earn income from gambling, drug dealing, and other illegal activities
Studied by 49 People