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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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Lesson 12: Elasticity and Demand | Unit 2: The Continuum
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Page: 9 of 25
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In this unit, you should have learned about:- How a given shift of the supply curve can result in different changes in equilibrium price and quantity based on the price elasticity of demand.
- That the coefficient of elasticity forms a continuum ranging from 0 to infinity.
- The five elasticity alternatives identified by segmenting the elasticity continuum -- perfectly elastic, relatively elastic, unit elastic, relatively inelastic, and perfectly inelastic.
- The different shapes of demand curves with different elasticities.
- Perfectly inelastic demand is a vertical demand curve.
- Perfectly elastic demand is a horizontal demand curve.
- Unit elastic demand is a concave demand curve without constant slope.
- Why relatively elastic demand curves are "sort of" flat and the relatively inelastic demand curves are "sort of" steep.
- Why this preceding statement is not technically correct because slope does NOT indicate elasticity.
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VARIABLE INPUT An input whose quantity can be changed in the time period under consideration. The most common example of a variable input is labor. Variable inputs provide the means used by a firm to control short-run production. The alternative to variable input is fixed input. A fixed input, like capital, provides the capacity constraint in production. As larger quantities of a variable input, like labor, are added to a fixed input like capital, the variable input becomes less productive, which is the law of diminishing marginal returns.
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BLACK DISMALAPOD
[What's This?]
Today, you are likely to spend a great deal of time at an auction hoping to buy either throw pillows for your living room sofa or a hepa filter for your furnace. Be on the lookout for pencil sharpeners with an attitude.
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This isn't me! What am I?
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A lump of pure gold the size of a matchbox can be flattened into a sheet the size of a tennis court!
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"The road to success is always under construction. " -- Lily Tomlin, Actress
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SFE
Sydney Futures Exchange
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