• Optimal Tax Theory

  • Overview Description Optimal tax theory is a study with an aim of finding the best ways to design or plan a tax to avoid inefficiency and economic distortion. The study encompasses such questions as to whether a jurisdiction... 

  • Supply and Demand

  • Overview Description When the need (demand) for goods increases and its availability (supply) decreases, the prices rise. On the other hand, if the availability of goods increases and the need or desire of goods or services... 

  • Rivalry

  • Overview Description Rivalry, according to economists, is the incapability of multiple consumers to use the same good. Economics divide goods into two broad ways; rivalrous (rival) and nonrival goods. A rival good is the... 

  • Tax Deferral

  • Definition Tax deferral is the payment of taxes in the future for earnings in the current year. It is an instance where taxpayers can holdup paying taxes to some future time. Theoretically, net tax paid ought to be equal... 

  • Tobin Tax

  • Overview A Tobin tax is an excise tax suggested on currency trade across borders with an aim of putting a penalty on short-term currency speculation, taming the volatility of the currency market and restoring back the national... 

  • Money Neutrality

  • Overview Neutrality of money is an economic theory stating that alterations in the aggregate supply of money only affects nominal variables, instead of real variables. Thus, when the money supply is increased, it will proportionately... 

  • Marginal Tax Rate

  • Description Whereas an average tax rate is the total payable tax as a percentage of the total income earned, marginal tax rate is the tax rate on the last dollar of the income earned – the tax paid on any additional dollar... 

  • Income Effect

  • Overview According to economics, income effect depicts the effects of alterations in the prices on consumption. It is the change in an individual’s income or an economy’s income, and how that change will have an impact... 

  • Implicit Cost

  • Overview Implicit cost, according to economists, happens when an individual foregoes an alternative action, without making the actual payment. It is basically a cost represented by a lost chance, say in the use of a company’s... 

  • Hyperinflation

  • Overview Hyperinflation, according to pundits, is an inflationary vicious sequence without propensity towards attaining equilibrium. In other words, it is an out of control inflation, excessively high and rapid inflation.... 

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