Unit 9 Vocabulary

Front 1

Entitlement

Back 1

A required government expenditure that continuesfrom one year to the next.

Front 2

Fiscal Policy

Back 2

A government’s use of spending and taxation toinfluence the economy.

Front 3

Tax

Back 3

The money that people and business pay tosupport the activities of the government.

Front 4

Gross Domestic Product or GDP

Back 4

Thetotal amount of good and services produced within a country.

Front 5

Aggregate Demand

Back 5

Thetotal demand of goods and services at a given price and given time.

Front 6

Expansionary Policy

Back 6

Intentionto increase the overall money supply to encourage economic growth or todecrease inflation.

Front 7

Contractionary Policy

Back 7

Intentionto decrease the overall money supply to discourage spending.

Front 8

Discretionary Spending

Back 8

Spendingthat Congress decides on each budget year.

Front 9

Mandatory Spending

Back 9

Spendingthat Congress must by law include in each year’s budget.

Front 10

Recession

Back 10

Twoconsecutive fiscal yearly quarters in which there is negative economic growthby GDP.

Front 11

Inflation

Back 11

Pricesof goods and services rise faster than employee wages and/or the buying powerof currency.

Front 12

Deflation

Back 12

Declinein prices for goods and services usually caused by decrease in the money supplyor available credit.

Front 13

Progressive Tax

Back 13

Governmenttax charges increase based on the amount of personal income.