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;
24 Cards in this Set
- Front
- Back
|
the total value of all final goods and services produced in a particular economy
|
GDP
|
|
|
gross domestic product measured in current prices
|
Nominal GDP
|
|
|
gross domestic product expressed in constant or unchanging, prices
|
Real GDP
|
|
|
How do fears of future economic problems affect GDP?
|
consumers will spend less and save money in case of future economic problems, GDP will be reduced.
|
|
|
What is the 4 phases of the business cycle?
|
Peak, recession, trough, and recovery
|
|
|
the amount of goods and services in the economy that will be purchases at all possible price levels
|
aggregate demand
|
|
|
the total amount of goods and services in the economy available at all possible prices level.
|
aggregate supply
|
|
|
Things that could shift AD
|
a change in consumption, investment, government spending and net exports
|
|
|
Things that could shift AS
|
change in availability of resources, cost of resources, technology and productivity, and taxes/subsidies.
|
|
|
demanding for goods and services exceed existing supplies.
|
demand - pull inflation
|
|
|
decline in RGDP combined with a rise in the price level
|
stagflation
|
|
|
Who is responsible for putting together the federal budget
|
president and congress
|
|
|
When to use expansionary fiscal policy?
|
during recession
|
|
|
when to use contractionary?
|
during inflation
|
|
|
Options for expansionary
|
1) increase gov. spending
2) reduce taxes |
|
|
options for contractionary
|
1) decrease gov. spending
2) increase taxes |
|
|
a situation in which the gov. spends more than it takes in
|
budget deficit
|
|
|
a situation in which the gov. takes in more than it spends
|
budget surplus
|
|
|
a school of economics that believes tax cuts can help an economy by raising supply
|
supply side economics
|
|
|
the actions the federal reserve takes to influence the level of real GDP and the rate of inflation in the economy
|
monetary policy
|
|
|
monetary policy that increase the money supply, fed uses it during contraction-declining income
|
Easy money policy
|
|
|
monetary policy that reduces the money supply, fed uses it during a rapid inflation that may causes high inflation
|
tight money policy
|
|
|
tell us how much the money supply will increase after an initial cash deposit to the banking system
|
money multiplier
|
|
|
banking system that keeps only a fraction of funds on hand and lends out the remainder
|
fractional reserve banking
|
