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36 Cards in this Set

  • Front
  • Back
limitations of fiscal policy
time lags;
policy makers have increased spending more than they have increased taxes
major problem with inflation
wage increases lag behind price increases
Fiscal policy used to increase aggregate demand (2 tools)
lower taxes;
increase govt spending
demand-pull inflation
demand outweighs supply
cost-push inflation
production costs increase
4 types of unemployment
frictional, structural, cyclical, and seasonal
frictional unemployment
skill level doesn't match job requirements
structural unemployment
changes in economy (ie we dont need typists anymore b/c of computer technology)
counter cyclical policy (during growth and recession)
growth- Ag. demand DECREASES
recession- Ag. demand INCREASES
2 types of stock
income stock and growth stock
income stock
pays most of profit back to shareholders
Group that regulates the stock market
Securities & Exchange Commission
change in CPI measures....
2 ways to make money in the stock market
dividends and capital gains
distribution of profits (from stock market)
capital gains
selling stock certificates for more than you bought them
Who is the main policy branch of the Fed?
Federal Open Market Committee
Preferred stocks
higher than common stocks;
get $ before common stocks
blue chip stocks
low-risk stocks;
well established companies
mutual fund
group/company that buys back shares and offers shares
When interest rates are high, the govt _____ but ____ is demanded
gives more money BUT less is demanded
spending more than a company makes
(result of deficit) money needed to be paid back
true/false? Higher interest rates reduce consumption.
true/false? Higher interest rates increase production.
NASDAQ controls what kind of stocks?
technical (dot com)
NYSE (New York Stock Exchange) controls what kind of stocks?
big market and big company
Which president did economy have surplus?
How does economy grow?
increase in consumption and investment
Keynesian policy is also known as...
demand side economy
demand management (demand side policy)
aka Keynesian policy;
wanted govt involvement in economy
when did Keynesian policy begin?
supply-side policy
pushes incentives for production, therefore increasing supply
stock split
dividing a company's stock into multiple shares
discount broker
a stockbroker that gives a discount on commission fees;
just does market trades
full service broker
more expensive than a discount broker;
offers advice, tax tips, and research