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.

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S

Saving function

A linear relationship showing how increases in disposable income cause increases in savings.

Scarcity

The imbalance between limited productive resources and unlimited human wants. Because economic resources are scarce, the goods and services a society can produce are also scarce.

Second hand sales

Final goods and services that are resold. Even if they are resold many times, final goods and services are only counted once, in the year in which they were produced.

Specialization

When firms focus their resources on production of goods for which they have comparative advantage, they are said to be specializing.

Spillover benefits

Additional benefits to society, not captured by the market demand curve from the production of a good, resulting in a price that is too high and a market quantity that is too low.

Spillover costs

Additional to society, not captured by the market supply curve from the production of a good, result in a price that is too low and market quantity that is too high.

Stagflation

A situation in the macroeconomy when inflation and the unemployment rate are both increasing.

Sticky prices

If price levels do not change, especially downward, with changes in ad, then prices are thought of as sticky or inflexible. Keynesians believe the price level does not usually fall with contractionary policy.

Stock

A certificate that represents a claim to, or share of, the ownership of a firm.

Substitute goods

Two goods are consumer substitutes if they provide essentially the same utility to the consumer.

Substitution effect

The change in qdemanded resulting from a change in the price of one good relative to the price of other goods.

Supply of loanable funds

The positive relationship between the dollars saved and the real interest rate.

Supply shocks

A supply shock is an economy-wide phenomenon that affects the costs of firms, and the position of the as curve, either positively or negatively.

Supply side fiscal policy

Fiscal policy centered on tax reductions targeted to as so that gdpr increases with very little inflation. The main justification is that lower taxes on individuals and firms increase incentives to work, save, invest and take risks.

Supply-side boom

When the as curve shifts outward and the ad curve stays constant, pl falls, gdpr increases and the unemployment rate falls.