Vocabulary

Question 1

Equilibrium wage

Answer 1

The quantity of workers demand equals the quantity of workers supplied

Question 2

Human capital

Answer 2

The knowledge and skills that enable workers to be productive

Question 3

Civilian labor force

Answer 3

People 16 or older who are employed to do work

Question 4

Outsourcing

Answer 4

The practice of contracting with an outside company

Question 5

Laissez faire

Answer 5

The government should not interfere in the economy

Question 6

Labor unions

Answer 6

An organization of workers that seek to improve wages

Question 7

closed shops

Answer 7

Business in which an employer can only hire union members

Question 8

Right to work laws

Answer 8

Legislation that makes it illegal to require workers to join unions

Question 9

Collective bargaining

Answer 9

The process of negotiation to establish wages and improve conditions

Question 10

Biding arbitration

Answer 10

An impartial 3rd party resolves disputed between management and unions

Question 11

Unemployment rate

Answer 11

Percentage of labor force is jobless and actively looking for work

Question 12

Full employment

Answer 12

Level of unemployment in which none of the unemployment is caused by decreasing economic activity

Question 13

Poverty threshold

Answer 13

Official minimum income needed to pay the basic expenses

Question 14

Lorenz curve

Answer 14

Curve that shows degree of income inequality in a nation

Question 15

Welfare

Answer 15

Government economic and social programs that provide assistance to needy

Question 16

Workforce

Answer 16

Program required welfare to do some kind of work for benefits

Question 17

Inflation

Answer 17

Sustain rise in general price level in purchasing power of money

Question 18

CPI

Answer 18

Consumer price index

Measure of change in price of goods

Question 19

PPI

Answer 19

Measure of changes in wholesale price

Question 20

Demand pull inflation

Answer 20

Condition that occurs when total demands rises faster than the production of goods

Question 21

Cost push inflation

Answer 21

Situation in which increases in production cost push up prices

Question 22

Proportional tax

Answer 22

Takes the same percentage on high income earners

Question 23

Progressive tax

Answer 23

Wealthy pay higher burden

Question 24

Regressive tax

Answer 24

Poor pay higher percentage

Question 25

Incidence of a tax

Answer 25

Final burden of a tax. Both sides pay

Question 26

Comparative advantage

Answer 26

Ability of one trading nation to produce something at a lower opportunity cost than that of a smaller trading nation

Question 27

Waged

Answer 27

Payments workers receive in return for work