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CLOSED ECONOMY: An economy with little or no foreign trade. A country with a closed economy can usually tend to it's problems without worrying about other countries. During the 1950s and 1960s, the good old U. S. of A. had relatively little foreign trade, and was very nearly a closed economy. But that was a unique period in the United States unmatched before or since. In fact, it's very difficult to find a real-life closed economy anywhere in the world today. Because of this, you should take a close look at the entry open economy.
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Lesson 15: Aggregate Market | Unit 4: Self Correction
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Page: 18 of 22
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Topic:
Inflationary Gap
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The aggregate market can automatically reach long-run equilibrium by closing an inflationary gap. Key points: - Short-run equilibrium is at the intersection of the AD and the SRAS (SRo) curves.
- The initial short-run price level is Po, and real production is Qo.
- Short-run equilibrium is to the right of the full employment production, Qf.
- We have an inflationary gap.
- As wages rise, production cost increases which decreases short-run aggregate supply.
- The SRAS curves shift to reach the full employment level at the intersection of the LRAS and AD curves.
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COMMON-PROPERTY GOODS Goods characterized by rival consumption and the inability to exclude nonpayers. Common-property goods are one of four types of goods differentiated by consumption rivalry and nonpayer excludability. The other three goods are private (rival consumption and nonpayers can be excluded), public (nonrival consumption and nonpayers cannot be excluded), and near-public (nonrival consumption and nonpayers can be excluded). Nonrival consumption and the ease of excluding of nonpayers means common-property goods cannot be efficiently exchanged through markets and are often overconsumed.
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BROWN PRAGMATOX
[What's This?]
Today, you are likely to spend a great deal of time watching infomercials trying to buy either a cross-cut paper shredder or a birthday greeting card for your father. Be on the lookout for a thesaurus filled with typos.
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This isn't me! What am I?
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A thousand years before metal coins were developed, clay tablet "checks" were used as money by the Babylonians.
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"Progress always involves risk. You can't steal second base and keep your foot on first. " -- Frederick B. Wilcox
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BHC
Bank Holding Company
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