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FEATHERBEDDING: A labor union practice of artificially increasing the number of workers employed even though the specific job or task can be completed with fewer workers. This can be done mandating that specific jobs be performed only by workers with specific skill levels or be mandating that a certain number of workers are needed to perform a job or task. By increasing the demand for workers, featherbedding also keeps wages higher.
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Lesson 5: Demand | Unit 2: Law of Demand
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Page: 8 of 20
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- The law of demand, which is a fundamental economic principle stating that demand price and quantity demanded are inversely related, ceteris paribus.
- Ceteris paribus, a Latin term meaning that other things remain unchanged. It is used to control for factors other than price, that affect demand.
- Why the law of demand works because of the income and substitution effects.
- The income effect, which exists because price changes affect the purchasing power of buyers' given incomes.
- The substitution effect, which exists because price changes make other goods relatively more or less expensive.
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ASSUMPTIONS, KEYNESIAN ECONOMICS The macroeconomic study of Keynesian economics relies on three key assumptions--rigid prices, effective demand, and savings-investment determinants. First, rigid or inflexible prices prevent some markets from achieving equilibrium in the short run. Second, effective demand means that consumption expenditures are based on actual income, not full employment or equilibrium income. Lastly, important savings and investment determinants include income, expectations, and other influences beyond the interest rate. These three assumptions imply that the economy can achieve a short-run equilibrium at less than full-employment production.
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The portion of aggregate output U.S. citizens pay in taxes (30%) is less than the other six leading industrialized nations -- Britain, Canada, France, Germany, Italy, or Japan.
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"Plans are only good intentions unless they immediately degenerate into hard work." -- Peter Drucker, management consultant
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TSE
Toronto Stock Exchange
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