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SAY'S LAW: A classical economic proposition stating that the production of aggregate output creates sufficient aggregate demand to purchase all of the output produced. In other words, supply creates its own demand. This is one of the three assumptions underlying the macroeconomic theory of classical economics which concluded that unrestricted market activity would generate full employment. The other two assumptions are flexible prices and saving-investment equality. Say's law is closely associated with the circular flow model.
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                           CURRENT SURPLUS OF GOVERNMENT ENTERPRISES: The excess of revenue over cost received by government-operated firms that sell their output through markets and otherwise operate like private, profit-oriented firms. This is one component of the official entry government subsidies less current surplus of government enterprises found in the National Income and Product Accounts maintained by the Bureau of Economic Analysis, that separates national income (the resource cost of production) and gross (and net) domestic product (the market value of production). Government enterprises are productive activities that operate much like private-sector firms. They hire resources and purchase inputs (intermediate goods and raw materials), then produce goods that are sold through markets. In some cases, government enterprises compete directly with private firms.One common example of a government enterprise is a city-operated electrical generation and distribution system. In some cities, this service is provided by private, for-profit, businesses. In other cities it is provided by government. Other examples of government enterprises include urban transportation systems, parks and recreational facilities, and communication systems. The primary difference between private firms and government enterprises, especially in the National Income and Product Accounts, is the treatment of profit. In a private firm, any profit generated (the difference between revenue and cost) is claimed by the owners, or the entrepreneurs. A government enterprise, in contrast, has NO specific owners to claim the profit. In essence the enterprise is owned by ALL citizens. As such, the "profit" of government enterprises is not earned by any specific factor of production. It is not considered part of national income. From a practical standpoint, the excess of revenue over cost for a government enterprise, which is termed "surplus" rather than profit, is merely returned to the appropriate government treasury. Should the city's electric utility "turn a profit" in a given year, this surplus is given back to the city. This is fitting because should the electric utility incur a loss, then the city makes up the difference. In terms of national income, the surplus of government enterprises is important because, unlike private business profit, it is NOT officially earned by any factors of production. Rather than being paid out as national income to any productive factors, this surplus is returned to the government treasuries. It is part of gross domestic product, but not part of national income.
Recommended Citation:CURRENT SURPLUS OF GOVERNMENT ENTERPRISES, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: January 24, 2025].
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Today, you are likely to spend a great deal of time searching for rummage sales trying to buy either a birthday gift for your grandmother or a T-shirt commemorating yesterday. Be on the lookout for neighborhood pets, especially belligerent parrots.
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The first U.S. fire insurance company was established by Benjamin Franklin in 1752 in Philadelphia.
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"Wherever you go, no matter what the weather, always bring your own sunshine." -- Anthony J. D'Angelo
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AR(N)
A nth-order Autoregressive Process
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