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Final Study Guide

Say's Law
supply creates its own demand
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real business cycle theory 
the economic theory that emphasizes how innovations to technology can cause fluctuations in economic activity
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Efficient Market Theory
the market is all knowing, so the buyer can't beat the market; from past able to predict the future
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Rational Expectations Hypothesis
most people act rationally, they will police themselves
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Free trade:
the movement of goods and services among nations without political or economic barriers; competitive advantage
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supply-side economics
a school of economics that believes tax cuts can help an economy by raising supply
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Market fundamentalism
the idea that markets are best left unregulated to maximize efficiency
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neo classical economics
- this sort of rationality is seen as a natural characteristic of human beings acting under economic constrains.
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Aggregate demand and aggregate supply model
A model that explains short-run fluctuations in real GDP and the price level.
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Keynesian Economics
Economic slumps are caused by inadequate spending and they can be mitigated by government intervention.
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bureaucratic model
a model of policy-making that holds that bureaucracies play a crucial role in making policy because of their commitment and the expertise they can provide
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elite model 
a view of society as being ruled by a small group of individuals who share a common set of political and economic interests.
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iron triangle
a close relationship between a legislative committee, an executive committee, and an interest group
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Revolving door
The tendency of public officials, journalists, and lobbyists to move between public and private sector (media, lobbying) jobs
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agency capture
term used to describe when an agency seems to operate for the benefit to those who, its supposed to regulate
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Disadvantages of Multiparty system
not enough support for one party, smaller parties have too much power
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Advantages of Multiparty System
rare that one party has an outright majority, voters have more choice, escape from conservative-liberal gridlock
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Advantages of a Two Party System
more political stability
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Disadvantages of a Two Party System
extremes, gridlock
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Incrementalist
believes in respecting past court decisions
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Restorationists
follow what the framers of the constitution intended
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Why are oil prices going up? 
-demand is increasing -supply is flat -speculation -international conflict
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Public Utilities Regulatory Act of 1978 (PURPA)
Made utilities pursue cleaner energy; purchase electricity produced by cogenerators
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Decoupling
the place where inventory is positioned to allow processes or entities in the supply chain to operate independently
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Lost Revenue Adjustment Mechanism
attempts to determine the portion of lostrevenue that results only from a successful energy efficiency program
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Energy Efficiency Utilities
Take conservation responsibilityaway from shareholder utilities
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smart grid
deliver elasticity using two-way digital technology; connect a bunch of microgrids
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American Recovery and Reinvestment Act
cash for wind power; created green jobs
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Storage Act
seeks to make energy storage technologies
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Drivers for Extinction
-habitat loss -overharvesting/hunting -bioinvasion -climate change -pollution
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Pluralism
The diffusion of power among many interest groups that prevents any single group from gaining control of the government; leaves no one happy
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Hyperpluralism
competition between interest groups causes political paralysis
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7 Energy Science Focuses
1. solar electricity 2. extreme materials 3. batteries & storage 4. efficient building 5. fuels from sun 6. smart grid 7. nuclear
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feed in tariffs
regional or national electricity utilities are obligated to buy renewable electricity at above market rates set by the government
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Smart grid - Why?
active consumer participation; isolate problems; real time pricing
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