Classes on the principles of economics are to a substantial degree vocabulary courses. You learn specific definitions of terms you are already vaguely familiar with and by doing so can draw inferences and distinctions that are not otherwise possible. The following terms are listed in the order they appear in the text:
Automatic Stabilizers: Government policies in place that act to stabilize the economy that do not require a specific act on the part of government to be effective. For example, progressive income tax rates increase tax burdens when incomes rise, and decrease tax burdens when incomes decline, allowing consumption to be smoother than the variations in income that support it.
Compensation Principle: The concept that ...
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