VWL 1, FFHS, Semester 3

the system made up of the ECB plus the national central banks of each of the 12 countries comprising the European Monetary Union

the property of a good whereby a person can be prevented from using it

input costs that require an outlay of money by the firm

goods and services that are produced domestically and sold abroad

the uncompensated impact of one person’s actions on the wellbeing of a bystander

the inputs used to produce goods and services

the central bank of the United States

money without intrinsic value that is used as money because of government decree

the field of economics that studies how people make decisions regarding the allocation of resources over time and the handling of risk

financial institutions through which savers can indirectly provide funds to borrowers

financial institutions through which savers can directly provide funds to borrowers

the group of institutions in the economy that help to match one person’s saving with another person’s investment

a fiscal system for a group of countries involving a common fiscal budget and a system of taxes and fiscal transfers across countries

the one-for-one adjustment of the nominal interest rate to the inflation rate

costs that do not vary with the quantity of output produced

 a banking system in which banks hold only a fraction of deposits as reserves

a person who receives the benefit of a good but avoids paying for it

unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills

the study of a company’s accounting statements and future prospects in order to determine its value

the amount of money in the future that an amount of money today will yield, given prevailing interest rates

the study of how people behave in strategic situations

a measure of the price level calculated as the ratio of nominal GDP to real GDP times 100

a good for which an increase in the price raises the quantity demanded

spending on goods and services by local, state and national governments

the market value of all final goods and services produced within a country in a given period of time

the idea that taxpayers with similar abilities to pay taxes should pay the same amount

the accumulation of investments in people, such as education and on-the-job training

 risk that affects only a single economic actor

input costs that do not require an outlay of money by the firm

a limit on the quantity of a good that can be produced abroad and sold domestically

goods and services that are produced abroad and sold domestically

the change in consumption that results when a price change moves the consumer to a higher or lower indifference curve

a measure of how much the quantity demanded of a good responds to a change in consumers’ income, computed as the percentage change in quantity demanded divided by the percentage change in income

the automatic correction of a money amount for the effects of inflation by law or contract