(also known as public debt)

the total amount owed by the Federal government to the owners of government securities; equal to the sum of past government budget deficits less government budget surpluses

pg. 625

the social science concerned with how individuals, institutions, and society make optimal (best) choices under conditions of scarcity

pg. 4

a natural, human, or manufactured item that helps produce goods and services.

pg. 10

human-made resources (buildings, machinery, and equipment) used to produce goods and services; goods tha do not directly satisfy human wants

pg. 10

the amount of other prodcuts that must be forgone or sacrificed to produce a unit of a product

pg. 4

the sacrifice of some or all of one economic goal, good or service to acheive some other goal, good, or service

pg. 9-10

in economics, spending for the production and accumulation of capital and additions to inventories.

pg. 476

Gross Domestic Product

(GDP)

the total market value fo all final goods and services produced annually within the boudnaries of the United States, whether by U.S.- or foreign-supplied resources; retail price

pg.486

a good or service that is characterized by nonrivalry and nonexcludability; a good or service with these charcteristics  provided by the government

pg. 100

Gross Domestic Income

(GDI)

Positive External Benefits

(Positive Externalities)

benefits obtained without compensation by third parties from the production or consumption  of sellers or buyers

Ex: A beekeeper benefits when a neighboring farmer plants clover. An external benefit or a spillover benefit.

pg. 105

Negative External Costs

(Negative Externalities)

costs imposed without compensation on third parties by the production or consumption of sellers or buyers

Ex: A manufacturer dumps toxic chemicals into a river, killing fish prized by sports fishers; an external cost or a spillover cost.

pg. 105

the amount by which the revenues (taxes) of the federal government exceed its expenditures in any year

pg. 616

when the revenues (taxes) of the Federal government equal its expenditures in any year.

pg. 747

the amount by which the expenditures of the Federal government exceed its revenue (taxes) in any given year

pg. 614

the amount by which a nation's imports of goods (or goods and services) exceed its exports of goods (or goods and services)

pg. 755, 782

the amount by which a nation's exports of goods (or goods and services) exceed its imports of goods (or goods and services)

pg. 755

short-term securities, medium-term securities, long-term securities

pg. 625-626

a tax whose average tax rate increases as the taxpayer's income increases and decreases as the taxpayer's income decreases; ex: federal personal income tax.

pg. 345

a tax whose average tax rate remains constant as the taxpayer's income increases or decreases

pg. 345

a tax whose average tax rate decreases as the taxpayer's income increases and increases as the taxpayer's income decreases

pg. 345

the amount or portion of a person's or group's expenditures which is used for non-essential or voluntary disbursements; U.S. government expenditures which are subject to annual review and authorization by Congress; spending that politicians have to vote for in order for it to take place.

Non-discretionary Spending

(Entitlement Spending)

spending that doesn't have to be approved by Congress: it happens automatically even if Congress doesn't vote for it; funding levels are automatically set by the number of eligible recipients, not at the discretion of Congress, each person eligible for benefits by law receives them unless Congress changes the eligibility criteria; represent the largest portion of the federal budget.

Ex: funds for programs like Medicare/Medicaid, Social Security, and veterans' benefits

a consumer good with an expected life (use) of three or more years

pg. 489

a consumer good with an expected life (use) of less than three years

pg. 489

a curve showing the different cominations of two goods or services that can be produced in a full-employment, full-production economy where the available supplies of resources and technology are fixed

pg. 11-12

Organization of Petroleum Exporting Countries

(OPEC)

a cartel of 12 oil-producing countries (Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, Venezuela, and the United States Arab Emirates) that attempts to control the quantity and price of crude oil exported by its members and that accounts for a large percentage of the world's export of oil.

pg. 232

North American Free Trade Agreement

(NAFTA)

a 1993 agreement establishing, over a 15-yeat period, a free-trade zone composed of Canada, Mexico, and the United States

pg. 520

European Union

(EU)

an association of 27 European nations (as of mid-2010) that has eliminated tariffs and quotas among them, established common tariffs for imported goods from outside the memmber nations, eliminated barriers to the free movement of capital, and created other common economic policies

pg. 773

World Trade Organization

(WTO)

an organization of 153 nations (as of mid-2010) that oversees the provisions of the current world trade agreement, resolves trade disputes stemming from it, and holds forums for further rounds of trade negotiations

pg. 404

Economic policy; incoroporates value judgements about what the economy should be like or what particular policy actions should be recommended to achieve a desirable goal; looks at the desirability of certain aspects of the economy; underlies expressions of support for particular economic policies; what ought to be

Ex: France ought to undertake policies to make its labor market more flexible to reduce unemployment rates.

pg. 7

what is being made

how its being made

how many are being made

who gets it

focuses on facts and cause-and-effect relationships; includes description, theory development and theory testing; avoids value judgements; tries to establish scientific statements about economic behavior and deals twith what the economy is actually like; what is

Ex: The unemployment reate in France is higher than that in the United States.

pg. 7