Expansionary fiscal policy
Contractionary fiscal policy
Expansionary monetary policy
Contractionary monetary policy
A. Expansionary fiscal policy
All else equal
Let the buyer beware
Supply creates its own demand
The invisible hand
The Federal Reserve adjusting interest rates
The government increasing spending on infrastructure projects
The government selling bonds to the public
The central bank conducting open market operations
The difference between a country's exports and imports of goods and services
The difference between government revenues and expenditures
The difference between a country's savings and investments
The difference between the government budget deficit and surplus
The speed at which money changes hands in an economy
The total amount of money in circulation in an economy
The total amount of money held by households and businesses
The total amount of money held by banks as reserves
Price elasticity of demand
Cross-price elasticity of demand
Income elasticity of demand
Price elasticity of supply
Inflation and unemployment
Government spending and taxes
Savings and investment
Consumption and income
The buying and selling of government securities by the central bank to influence the money supply
The buying and selling of goods and services in international markets
The buying and selling of stocks in the stock market
The buying and selling of consumer goods in a free market economy
The level of government spending
The level of potential output
The level of aggregate demand
The level of inflation
Profits earned from selling an asset, like a stock or real estate, at a higher price than it was purchased
Profits earned from producing and selling goods and services
Wages earned from labor
Interest earned from savings accounts
An extremely high and rapidly increasing inflation rate
A moderate and stable inflation rate
A period of deflation in the economy
A period of steady economic growth
A collection of goods and services used to calculate inflation
A collection of goods and services that a consumer typically buys
A collection of goods and services used to calculate GDP
A collection of goods and services produced in a specific industry
The change in consumption resulting from a change in disposable income
The total amount of consumption in an economy
The change in investment resulting from a change in interest rates
The change in saving resulting from a change in disposable income
The value of the next best alternative that must be forgone when a decision is made to allocate resources to a particular use
The total cost incurred in producing a good or service
The cost incurred when a firm decides to shut down operations
The cost of goods and services in an open economy
The decrease in private spending that occurs as a result of an increase in government spending
The increase in private investment that occurs as a result of government borrowing
The decrease in government spending that occurs during a recession
The increase in government spending that occurs during a boom
Gross Domestic Product (GDP)
Consumer Price Index (CPI)
Money Supply (M2)
Aggregate Demand (AD)
The difference between the highest price a consumer is willing to pay for a good and the price they actually pay
The difference between the cost of production and the price at which a good is sold
The total amount of money spent by consumers on goods and services
The total amount of money earned by consumers from their jobs
Tax rates and tax revenue
Government spending and economic growth
Inflation and unemployment
Interest rates and investment
A record of all economic transactions between residents of a country and the rest of the world in a given period
The difference between government revenues and expenditures in a given period
The difference between exports and imports of goods and services in a given period
The total amount of money in circulation in a country
Money that has intrinsic value, such as gold or silver
Money that is backed by the government's promise to exchange it for a commodity
Money that is used for international trade
Money that is created by the central bank
Exports exceed imports
Imports exceed exports
Both exports and imports are equal
Both exports and imports are zero
The total amount of money in an economy
The total value of physical and human capital in an economy
The total amount of money held by households
The total amount of money held by businesses
The price level and the quantity of real GDP demanded
The interest rate and investment spending
The price level and the quantity of money demanded
The exchange rate and net exports
The change in saving resulting from a change in disposable income
The total amount of saving in an economy
The change in consumption resulting from a change in disposable income
The total amount of consumption in an economy
Actual output is less than potential output
Actual output is greater than potential output
The inflation rate is high
The unemployment rate is low
Gini coefficient
Consumer Price Index (CPI)
Producer Price Index (PPI)
Lorenz curve
The impact of an initial change in spending on aggregate demand and, consequently, on real GDP
The tendency of consumers to save a large portion of their income
The effect of an increase in the money supply on interest rates
The impact of inflation on purchasing power
Government policies that automatically adjust to stabilize the economy during economic fluctuations
The tools used by the central bank to stabilize the money supply
The policies implemented by the government to control inflation
The policies implemented by the government to control unemployment
Prices that do not change quickly in response to changes in supply and demand
Prices that are set by the government and cannot be changed by firms
Prices that are adjusted continuously in response to changes in the economy
Prices that are set by monopolies to maximize profit
The process through which changes in monetary policy affect the overall level of economic activity
The process through which changes in fiscal policy affect the overall level of economic activity
The process through which changes in exchange rates affect the overall level of economic activity
The process through which changes in international trade affect the overall level of economic activity
The additional revenue earned from producing one more unit of a good or service
The total revenue earned by a firm
The total cost of producing a given quantity of a good or service
The additional cost of producing one more unit of a good or service