Government and the Economy flashcards

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What is meant by “Tax” in this lesson?Taxes and spending: A tax is a compulsory payment imposed by government under applicable law.
What is meant by “Government purchase” in this lesson?Taxes and spending: A government purchase buys goods or services and differs from a transfer payment.
What is meant by “Transfer payment” in this lesson?Taxes and spending: A transfer provides income without purchasing current production from the recipient.
What is meant by “Budget deficit” in this lesson?Taxes and spending: A deficit occurs when spending exceeds revenue during a period under the accounting definition.
What is meant by “Public debt” in this lesson?Taxes and spending: Public debt is an accumulated stock of outstanding government borrowing.
What is meant by “Tax incidence” in this lesson?Taxes and spending: Tax incidence concerns who ultimately bears a tax's economic burden, not only who remits it.
What is meant by “Fiscal policy” in this lesson?Fiscal policy: Fiscal policy uses government spending and taxation to influence economic conditions.
What is meant by “Expansionary fiscal policy” in this lesson?Fiscal policy: Expansionary fiscal measures aim to increase aggregate demand through spending increases or tax reductions.
What is meant by “Contractionary fiscal policy” in this lesson?Fiscal policy: Contractionary fiscal measures aim to reduce aggregate demand through spending cuts or tax increases.
What is meant by “Automatic stabilizer” in this lesson?Fiscal policy: An automatic stabilizer changes budget flows with economic conditions without a new discretionary decision.
What is meant by “Fiscal multiplier” in this lesson?Fiscal policy: A multiplier describes total output response relative to an initial fiscal change under specified assumptions.
What is meant by “Crowding out” in this lesson?Fiscal policy: Crowding out occurs when public activity displaces some private activity under relevant conditions.
What is meant by “Regulation” in this lesson?Regulation and tradeoffs: Regulation establishes enforceable rules governing specified activities.
What is meant by “Market failure” in this lesson?Regulation and tradeoffs: Market failure describes conditions where unregulated allocation falls short of a specified efficiency benchmark.
What is meant by “Compliance cost” in this lesson?Regulation and tradeoffs: Compliance costs are resources used to meet regulatory requirements.
What is meant by “Enforcement” in this lesson?Regulation and tradeoffs: Enforcement monitors and applies rules through authorized procedures.
What is meant by “Regulatory capture” in this lesson?Regulation and tradeoffs: Capture occurs when regulated interests unduly influence a regulator's decisions.
What is meant by “Policy evaluation” in this lesson?Regulation and tradeoffs: Evaluation compares outcomes and alternatives with attention to causality and distribution.