| A | B |
|---|
| Monetary policy | Government strategies for controlling the money supply |
| Fiscal policy | Involves the use of the government's power to tax and spend |
| Economic indicators | GDP and the unemployment rate, for example |
| Automatic stabilizers | Income taxes and unemployment benefits, for example |
| Real GDP per capita | The nation's output adjusted for changes in the cost of living and population |
| Perfect competition | Large numbers of buyers and sellers dealing in an identical product |
| Merger | Combining two or more firms into one |
| Regressive tax | Tax that affects low-income groups more than high-income groups |
| Proportional tax | Requires each person to pay the same percentage of his or her income in taxes |
| Monopolistic competition | A market with many sellers providing similar products |
| Ability-to-pay principle | Theory that those with higher incomes should pay more in taxes than those with lower incomes |
| Progressive tax | Tax that takes a larger percentage from a high-income taxpayer than from a low-income taxpayer |
| Legal monopoly | Public utility |
