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DECISION LAG: The time lag that it takes government leaders and policy makers to determine the appropriate government action needed to address an economic problem. The decision lag arises because it takes time for policy makers to chose among the array of possible policy actions, each with assorted consequences that appeal differently to different political constituencies. This "inside lag" is one of four policy lags associated with monetary and fiscal policy. The other two "inside lags" are recognition lag and implementation lag, and one "outside lag" is implementation lag. All four policy lags can reduce the effectiveness of business-cycle stabilization policies and can even destabilize the economy.
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MARGINAL PROPENSITY TO CONSUME The proportion of each additional dollar of household income that is used for consumption expenditures. The marginal propensity to consume (abbreviated MPC) is another term for the slope of the consumption line and is calculated as the change in consumption divided by the change in income. The MPC plays a central role in Keynesian economics. It quantifies the consumption-income relation and the fundamental psychological law. It is also a foundation for the slope of the aggregate expenditures line and is critical to the multiplier process. A related consumption measure is the average propensity to consume.
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RED AGGRESSERINE
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Today, you are likely to spend a great deal of time watching the shopping channel looking to buy either a birthday greeting card for your grandmother or a coffee cup commemorating yesterday. Be on the lookout for slow moving vehicles with darkened windows.
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Only 1% of the U.S. population paid income taxes when the income tax was established in 1914.
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"Don't judge each day by the harvest you reap but by the seeds that you plant. " -- Robert Louis Stephenson, writer
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