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21 Cards in this Set
- Front
- Back
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________ refers to the existense of STIMULTANEOUS INFLATION and UNEMPLOYMENT
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Stagflation
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The _______ _______ demonstrates a trade-off between inflation and unemployment
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Phillips Curve
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Shift upwards in Phillips Curve caused by and ________ in inflationary expectations
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INCREASE
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________ __________ - built in features of the economy that operate continuously to stabilize the economy
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Automatic Stabilizer
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Automatic Stabilizers estimated that they reduce severity of the buisness cycle from .5 to ___
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1/3
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The Automatic Stabilizer says that if GDP Rises, then Tax Revnues ____
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Rise
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Surplus is CONTRACTIONARY so we want to run them when the economy is already __________
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expanding
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Deficit is EXPANSIONARY so we want to run them when the economy is _______
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contracting
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"Don't worry be happy" system
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Functional Finance
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Last president to run a budget surplus was _____ ______
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Bill Clinton
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_____ _____ is the sum of all the budget deficits still outstanding
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National Debt
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Running a budget _______ pays down the national debt
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surplus
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_____ is ineffecient b/c it requires coincidence of wants
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Barter
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______ money has no value as a commodity
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Fiat
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______ money is usally gold or silver but could be any commodity
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Commodity
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Definition of Money
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Currency Outside Banks (paper, coins) + Demand Deposits (Checking Accounts)
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Every time a bank makes a loan, they create ________
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money
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The Reserve Requirement is the % of ______ ________ that a bank must keep on RESERVE as cash in the vault or on deposit
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Demand Deposits
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The Reserve Requirement is the % of Demand Deposits that a bank must keep on ________ as cash in the vault or on deposit
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Reserve
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Any bank can only loan out up to the amount of its ______ reserves
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excess
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Actual Reserves - Required Reserves = ________ ________
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Excess Reserves
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