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18 Cards in this Set
- Front
- Back
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Revenue and expenditure items in the federal budget that automatically change with the state of the economy in such a way as to stabilize GDP
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Automatic Stabilizers
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The Ratio of Change in the equilibrium level of output to a change in government spending where the change in government spending is balanced by a change in taxes so as not to create any deficit
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Balanced-budget multiplier
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The difference between what a government spends and what it collects in taxes in a given period G-T
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Budget Deficit
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The deficit that occurs because of a down turn in the business cycle
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Cyclical Deficit
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Changes in taxes or spending that are the result of deliberate changes in government policy
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Discretionary fiscal policy
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Total income minus net taxes Y-T
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Disposable, or after-tax income (Yd)
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The Budget of the federal government
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Federal Budget
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The total amount owed by the federal government
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Federal Debt
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Federal government receipts minus expenditures
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Federal Surplus(+) or deficit(-)
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The negative effect on the economy that occurs when average tax payers have moved into higher income brackets during an expansion
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Fiscal drag
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The governments spending and taxing policies
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Fiscal policy
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What the federal budget would be if the economy were producing at a full employment level of output
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Full employment budget
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The ratio of the change in the equilibrium level of output to a change in government spending
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Government spending multiplier
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The behavior of the Federal Reserve concerning the nation's money supply
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Monetary Policy
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Taxes paid by firms and households to the government minus transfer payments made to households by the government
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Net Taxes (T)
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The privately held (non-government-owned) debt of the U.S. governemnt
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Private held federal debt
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The deficit that remains at full empolyment
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Structural Deficit
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The ratio of change in the equilibrium level of output to a change in taxes
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Tax Multiplier
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