Term
|
Definition
| manipulation of the level of government spending and taxation, to achieve macroeconomic goals |
|
|
Term
| Excessive Agregate Demand |
|
Definition
|
|
Term
|
Definition
| High Unemployment and High Inflation |
|
|
Term
|
Definition
| to manipulate the level of taxation and governement regulations to achieve macroexonomic goals |
|
|
Term
|
Definition
| When the market value of goods and services is expressed in prices |
|
|
Term
|
Definition
| The Federal Reserve System was founded |
|
|
Term
|
Definition
-A medium of Exchange
-Unit of Account
-Store of Value |
|
|
Term
| The primary components of aggregate demand |
|
Definition
Consumption
Investment
Government spending
Net Exports |
|
|
Term
|
Definition
Increase Government Spending
Lowering Taxes |
|
|
Term
|
Definition
Decrease Govt Spending
Increase Taxes |
|
|
Term
|
Definition
| "Lower tax rates encourage people to work, save, and invest, resulting in more output and larger tax base" |
|
|
Term
| Supply-side economists would advocate |
|
Definition
| Reduction in: regulation, resources prices and taxes |
|
|
Term
|
Definition
| Direct exchange of goods and services |
|
|
Term
| A Double Coincidence of Wants |
|
Definition
| Barter often fails due to the absence of |
|
|
Term
|
Definition
| When money is used to pay for goods and services |
|
|
Term
|
Definition
| When money is used to transform current income into future purchases |
|
|
Term
|
Definition
| When money is acceptable because the government requires that it be accepted in payment for debt |
|
|
Term
|
Definition
| is not backed by any precious metal |
|
|
Term
|
Definition
| coins, currency, checkable deposits and travelers checks |
|
|
Term
|
Definition
| M1 plus savings accounts, small time deposits |
|
|
Term
| The Federal Reserve System |
|
Definition
| controls the money supply |
|
|
Term
|
Definition
| The Chair of the Board of Governors of the Fed |
|
|
Term
|
Definition
| The study of aggregate economic behavior |
|
|
Term
| The Business Cycle shows... |
|
Definition
| how economic activity and real GDP fluctuates around its long-term growth trend |
|
|
Term
|
Definition
| All persons 16 and older who are either working for pay or actively seeking employment |
|
|
Term
|
Definition
| Inflation caused by shifts of the aggregate demand curve |
|
|
Term
|
Definition
| Inflation caused by shifts of the aggregate supply curve |
|
|
Term
| Things that do not count in GDP |
|
Definition
-Intermediate Goods
-Used goods
-Stocks & Bonds
-Transfer Payments
-Underground economy |
|
|
Term
|
Definition
Short term unemployment
-ex: graduates looking for work |
|
|
Term
|
Definition
Unemployment that includes a mismatch of skills
-ex: encyclopedia salesman |
|
|
Term
|
Definition
Unemployment due to business cycles
-ex: laid off bc of recession |
|
|
Term
|
Definition
| the rate that inflation decreases |
|
|
Term
|
Definition
| When the inflation rate is more than 50% a month |
|
|
Term
|
Definition
| Actual amount of salary received |
|
|
Term
|
Definition
| The goods and services that can be purchased with the nominal income |
|
|
Term
|
Definition
-Prices Rise
-Value of ppls assets and wealth fall
-Ppl buy less and spend less
-RGDP decreases |
|
|
Term
|
Definition
-Prices Increase
-The nominal interest rate goes up
-ppl borrow less and spend less
-RGDP decreases |
|
|
Term
|
Definition
-Prices rise
-Prices of domestic goods increase
-Ppl buy less domestic goods
-RGDP decreases |
|
|
Term
|
Definition
Father of Modern Economics
-Laissez Faire
-Market's invisible hand
-classical school of thought |
|
|
Term
| Classical School of Thought |
|
Definition
1.Prices and Wages are perfectly flexible
2. Bus. cycles are natural phases
3. The economy always moves twd full employment
4. Govt interference is unnecessary
5. Says Law: supply creates its own demand |
|
|
Term
| Keynesian School of Thought |
|
Definition
1. Economy is inherently unstable
2. Prices and wages are sticky, not flexible
3. Govt intervention = necessary |
|
|
Term
|
Definition
|
|
Term
|
Definition
|
|
Term
|
Definition
| President of the Fed of Cleveland |
|
|
Term
|
Definition
| GDP = C + I + G + (X - M) |
|
|
Term
|
Definition
|
|
Term
| The base year in the consumer price index (CPI) |
|
Definition
| a year chosen as a reference for prices in all other years |
|
|
Term
| The aggregate demand curve is defined as |
|
Definition
| the real GDP purchased at different possible price levels |
|
|
Term
| What will shift the aggregate demand curve to the left? |
|
Definition
| A decrease in government spending |
|
|
