|
SELF-CORRECTION, RECESSIONARY GAP: The automatic process through which the aggregate market achieves long-run equilibrium by eliminating a recessionary gap created by short-run equilibrium. With a recessionary gap short-run equilibrium real production is less than full-employment real production, meaning resource markets have surpluses, and in particular labor is unemployed. Self-correction is the process in which these temporary imbalances are eliminated through flexible prices as the aggregate market achieves long-run equilibrium. The key to this process is shifts of the short-run aggregate supply curve caused by changes in wages and other resource prices. The long-run result is lower wages and an increase in short-run aggregate supply.
Visit the GLOSS*arama
|
|
|
|
Lesson 15: Cost | Unit 2: Three Totals
|
Page: 7 of 24
|
- The graphs of the three total cost relations important to the study of short-run production:
- Total Fixed Cost Curve: The total fixed cost (TFC) curve is a horizontal line, which is horizontal at the value of total fixed cost.
- Total Variable Cost Curve: The total variable cost (TVC) curve is a positively-sloped line.
- Total Cost Curve: The shape of the TC curve is identical to that of the TVC.
|
|
|
|
|
|
REAL GROSS DOMESTIC PRODUCT The total market value, measured in constant prices, of all goods and services produced within the political boundaries of an economy during a given period of time, usually one year. The key is that real gross domestic product is measured in constant prices, the prices for a specific base year. Real gross domestic product, also termed constant gross domestic product, adjusts gross domestic product for inflation. A contrasting measure is nominal gross domestic product, which does not adjust for inflation.
Complete Entry | Visit the WEB*pedia |
|
|
PURPLE SMARPHIN [What's This?]
Today, you are likely to spend a great deal of time waiting for visits from door-to-door solicitors hoping to buy either several magazines on computer software or a T-shirt commemorating the second moon landing. Be on the lookout for poorly written technical manuals. Your Complete Scope
This isn't me! What am I?
|
|
In the late 1800s and early 1900s, almost 2 million children were employed as factory workers.
|
|
"We succeed in enterprises (that) demand the positive qualities we possess, but we excel in those (that) can also make use of our defects." -- Alexis de Tocqueville, Statesman
|
|
AVT Ad Valorem Taxes
|
|
Tell us what you think about AmosWEB. Like what you see? Have suggestions for improvements? Let us know. Click the User Feedback link.
User Feedback
|
|