Term
|
Definition
| The price paid for the use of land and other natural resources, the supply of which is fixed (perfectly inelastic). |
|
|
Term
| Incentive Function (of price) |
|
Definition
| The inducement that an increase in the price of a commodity gives to sellers to make more available (and conversely for a decrease in price), and the inducement that an increase in price offers to buyers to purchase smaller quantities (and conversely for a decrease in price). |
|
|
Term
|
Definition
| The idea that economic rent could be heavily taxed, or even taxed away, without diminishing the availabile supply of land or, therefore, the productive potential economy as a whole. |
|
|
Term
| Lonable Funds Theory of Interest |
|
Definition
| The concept that the supply of and demand for lonable funds determine the equilibrium rate of interest. |
|
|
Term
|
Definition
| An essentially risk-free, long-term interest rate that is free of the influence of market imperfections. |
|
|
Term
|
Definition
| The amount of money received by a worker per unit of time (hour, day, etc.); money wage. |
|
|
Term
|
Definition
| The interest rate expressed in dollars of constant value (adjusted for inflation) and equal to the nominal interest rate less the expected rate of inflation. |
|
|
Term
|
Definition
| State laws that specify the maximum legal interest rate at which loans cna be made. |
|
|
Term
|
Definition
| The monetary payment a firm must make to an outsider to obtain a resource. |
|
|
Term
|
Definition
| The monetary income a firm sacrifices when it uses a resource it owns rather than supplying the resource in the market; equal to what the resource could have earned in the best paying alternative employment; includes normal profit. |
|
|
Term
|
Definition
| The total revenue of a firm less its economic costs (which include both explicit costs and implicit costs); also called "pure profit" and "above-normal profit." |
|
|
Term
|
Definition
| The payment made by a firm to obtain and retain entrepreneurial ability; the minimum income entrepreneurial ability must receive to induce it to perform entrepreneurial functions for a firm. |
|
|
Term
|
Definition
| A hypothetical economy in which the basic forces such as resource supplies, technological knowledge and consumer tastes are constant and unchanging. |
|
|
Term
|
Definition
| An event that would result in a loss but whose frequency of occurence can be estimated with considerable accuracy. Insurance companiees are willing to sell insurance against such losses. |
|
|
Term
|
Definition
| An event that wo uld result in a loss and whose occurrence is uncontrollable and unpredictable. Insurance companies are not willing to sell insurance against such a loss. |
|
|
