Econ vocabulary

aggregate supply curve

hypothetical curve showing different levels of real GDP that would be produced at various price levels

allocation

distribution

alternative minimum tax

personal income tax rate that applies to cases where taxes otherwise fall below a certain level analyze ana

analyze 

to break down into parts to study how each part related to another 

angel investors 

informal and usually affluent investors who provide funds to less-promising start upts 

anticipate 

to expect or be sure of in advance 

appropriations bill

legislation authorizing spending for certain purposes

arbitrary

randomly or by chance

arbitration 

agreement by two parties to place a dispute before a third party for a binding settlement; also called binding arbitration 

ASEAN

group of ten Southeast Asian nations working to promoter regional cooperation, econonmic growth, and trade 

aspects

parts, phases

assumptions

something we think is true or take for granted

automatic stabalizers 

programs that automatically provide government benefits during an econonmic downturn, unemployment, insurance, adn entitlement programs 

average revenue 

avarage price that every unit of output sells for 

average tax rate 

total taxes paid divdied by the total taxablle income 

baby boom

historically high birthrate years in the United States from 1946-1964

baby boomers

people born in the United States during the historically high birthrate years from 1946 to 1964

balance of payments

difference between money paid to and money received from other nations in trade; balance on current accounts in

balanced budget

balanced budget amendment

constitutional amendment requiring government to spend no more than it collects in taxes and other revenues,excluding borrowing 

bank holding companies 

company that owns and controls one or more banks

bank holiday

brief period during which all banks or depository instutions are closed to prevent bank runs

bank run

sudden rush by depositors to withdraw all deposited funds, generally in anticipation of bank failure or closure

barter econonmy

moneyless econonmy that relies on trade or barter

base year

year serving as a point of comparison for other years in a price index or other statsitical measure

bear market 

period during which stock market prices move down for several months or years in a row

beneficiary

person designated to take ownership of an asset if the owner of the asset dies 

Better Business Bureau

business-sponsored nonprofit organization providing information on local companies to consumers 

biofuels

fuel made from wood, peat, or other biological waste

bond

formal contract to repay borrowed money

break-even point

production level where total cost = total revenue, production enedd if the firm is to recover its cost 

budget deficit

a negative balnace after expenditures are substracted from revenues

budget surplus

a positive balance after expenditures are substracted from revenues

bulk-gaining industries

industries that prefer to have their factories closer to the market for the finished product because it is difficult or more expensive to transport than their raw materials 

bulk-losing industries

industries that prefer to be situated close to their raw materials in order to lose unnecessary material because the finished product is lighter, easier, or cheaper to transport 

bull market

period during which stock market prices move up for several months or years in a row

business cycles

systematic changes in real GDP mared by alternating periods of expansion and contraction

business flucuations

changes in real GDP marked by alternating periods of expansion and contraction that occur on an irregular basis 

call option 

futures contract giving investors the option to cancel a contract to buy commodities, equities, or financial assets

capital

tools, equipment, and factories used in the production of goods and services; one of the four factors of production

capital flight

legal or illegal export of a nations currency and foreign exchange 

capital formation

the transfer of money from hosueholds to businesses and government through investments and loans 

capital gains

profits from the sale of an asset held for 12 months or longer

capital goods 

tool, equipment, or other manufactured good used to produce other goods and services; a factor of preduction 

capital intensive

requiring large amounts of capital in relation to labor

capitalism

econonmic system in which private citizens own and sue the factors of production in order to generate profits

cartel

a group fo sellers or producers acting together to raise prices by restricting availability of a product

cash flow 

total amount of new funds the business generates from operations; broadest measure of profits for a firm because it includes both net income and noncash charges

catalyst

something that stimulates activity amoung people or forces 

cease and desist order

ruling requiring a company to stop an unfair business practice that reduces or limtis competition

census

complete count of population, including place of residence

center of population

point where the country would balance if it were flat and everyone weighted the same

central bank 

a bank that can lend to others banks in times of need, or a “bankers bank”

certifcates of deposit/ CD’s 

receipt showing that an investor has made an interest-bearing loan to a financial instiuttion 

chamber of commerce 

noprofit organization of local businesses whose purpose is to promote their interests 

change in demand

different amounts of a product are demanded at every price, causing the demand curve to shift to the left or to the right

change in quantity demanded

movement along the demand curve showing that a different quantity is purchased in response to a change in price

change in quantity supllied

change in the amount offered for sale in response to a price change- movement along the supply curve

charter

written government approcal to estabilsh a corporation; includes company name, address, purpose of business, number of shares of stock, and other features of the business 

civilian labor force

noninstitutionalized part of the population, aged 16 and over, either working or looking for a job

collateral

something of value that a borrower lets a lender claim if a loan is not repaid 

collective bargaining

process of negoitation between union and managment representatives over pay, benfeits, and job related matters

commodity money

money that has an alternative use as an econonmic good (ex. gunpowder)

Common Market for Eastern and Southern Africa (COMESA)

a trading organization consiting of nineteen nations that pools its resources to produce peace and security

Common Stock

Company Unions

unions organized, sup

Compaative advantage

country’s abiltiy to product a given product relatively more efficiently than another country production at a lower opportunity cost

collusion

illegal agreement amoung producers to fix prices, limit output, or divide markets

conglomerate