Absolute (Money) Price

International Trade Effect The change
in foreign sector spending as the price level
changes.
Interpersonal Utility Comparison
Comparing the utility one person receives
from a good, service, or activity with the
utility another person receives from the same
good, service, or activity.
Inventory Investment Changes in the
stock of unsold goods.
Inversely Related Two variables are
inversely related if they change in opposite
ways.
Investment The sum of all purchases of
newly produced capital goods, changes in
business inventories, and purchases of new
residential housing.
Investment Bank A firm that acts as an
intermediary between the company that
issues the stock and the public that wishes
to buy it.
J
J-Curve The curve that shows a short-run
worsening in net exports after a currency
depreciation, followed by an improvement.
L
Labor The physical and mental talents
people contribute to the production process.
Labor Force Participation Rate The
percentage of the civilian noninstitutional
population that is in the civilian labor force:
Labor force participation rate 5 Civilian labor
force/Civilian noninstitutional population.
Laffer Curve The curve, named after
Arthur Laffer, that shows the relationship between tax rates and tax revenues.
According to the Laffer curve, as tax rates
rise from zero, tax revenues rise, reach a
maximum at some point, and then fall with
further increases in tax rates.