Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
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....
|
...inflation
|
|
|
2 ways to make money in the stock market
|
dividends and capital gains
|
|
|
dividends
|
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
|
|
|
deficit
|
spending more than a company makes
|
|
|
debt
|
(result of deficit) money needed to be paid back
|
|
|
true/false? Higher interest rates reduce consumption.
|
TRUE
|
|
|
true/false? Higher interest rates increase production.
|
FALSE
|
|
|
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?
|
Clinton
|
|
|
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?
|
1930-1970
|
|
|
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 |
