Chapter 21 Flashcards
(11 cards)
Capital Gains Tax
A tax on profits earned when a financial asset is sold at more than its acquisition price
Capital per Worker
The total capital stock divided by total employment
Catch-up Growth
Economic growth, primarily in less advance countries, based on increasing capital per worker from low levels, and adopting technologies already used in more advanced countries
Consumption Tax
A tax on the part of the income that households spend
Corporate Profits Tax
A tax on the profits earned by corporations
Discovery Based Growth
Economic growth, primarily in advanced countries, based on technological change from new discoveries
Growth Equation
An equation showing the percentage growth rate of real GDP per capita as the sum of the growth rates of productivity, average hours, and the employment-population ratio
Investment tax credit
A reduction in taxes for firms that invest in new capital
Labor Productivity
The output produced by the average working in an hour
Supply Side Effects
Macroeconomic policy effects on total output that work by changing the quantities of resources available
Technological Change
The invention of and use of new inputs, new outputs, or new production methods
