Course glossary

During lectures you will learn new words. Using this link you are welcome to add them to our "course glossary", so that other students will be able to see them and learn. Let's make our own useful glossary and help each other to learn new words! By the way, there are already some worlds which should be familiar for you till the end of the course, try to cover them when you mill have free time.

Browse the glossary using this index

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A

Asset demand

The amount of money demanded as an asset. As nominal interest rates rise, the oc of holding money begins to rise and you are more likely to lesson your asset d for money.

Asset of a bank

Anything owned by the bank or owed to the bank.

Automatic stabilizers

Mechanisms built into the tax system that automatically regulate, or stabilize, the macroeconomy as it moves through the business cycle by changing net taxes collected by the government. These stabilizers increase a deficit during a recessionary period and increase a budget surplus during an inflationary period, without any discretionary change on the part of the government.

Autonomous consumption

The amount of consumption that occurs no matter the level of disposable income. In a linear consumption function, this shows up as a constant and graphically it appears as the y intercept.

Autonomous investment

The level of investment determined by investment demand. It is autonomous because it is assumed to be constant at all levels of gdp.

Autonomous saving

The amount of saving that occurs no matter the level of disposable income. In a linear saving function, this shows up as a constant and graphically it appears as the y intercept.

Average tax rate

The proportion of total income paid to taxes. It is calculated by dividing the total taxes owed by the total taxable income.

B

Balance of payments statement

A summary of the payments received by the u.s. from foreign countries and the payments sent by the u.s. to foreign countries.

Balance sheet

A tabular way to show the assets and liabilities of a bank.

Base year

The year that serves as a reference point for constructing a price index and comparing real values over time.