Fiscal Policy/Monetary Policy
Money
Foreign Exchange/Unemployment
Changes
Graphs
100
Fiscal policy used to fix an inflationary gap
What is Raising Taxes or Decreasing Government Spending?
100
The equation for tax multiplier
What is mpc/mps?
100
Definition of NRU and what it is
What is 4-6% and is
100
Shifters of the PPC
What is Change in resource quality/quantity, technology, and trade?
100
The graph that is used for
What is Aggregate Supply and Demand Graph
200
Monetary Policy used to fix a recessionary gap
What is Selling Bonds?
200
This is the equation for GDP Deflator and Nominal GDP
What is Nominal GDP =( Deflator x Real GDP )/100, GDP Deflator = Nominal/Real x 100?
200
When a country's money supply increases, its value changes.
What is depreciation?
200
5 Factors of Supply
What is Price, Number of Sellers, Technology, Government Action, Expectations of Future Profit?
200
Price levels increase, Unemployment increases, and often from supply shock
What is Stagflation?
300
Monetary Policies Limited Reserves
What is RR, OMO, DR / Change in Sm &Nir?
300
Reserve Requirements are directly connected to
What is Demand Deposits?
300
Calculate the Labor Force AND Unemployment Rate equations
What is LF=UE+EM? UR=UE/LF
300
5 Shifters of Demand
What are Tastes and Preferences, Number of Consumers, Price of Relative Goods, Income, and Future Expectations?
300
The X and Y labels of the Reserve Market Model
What is the Policy rate and Quantity of Reserves?
400
Recognition Lag is
What is the time taken to realize a recession occurred?
400
What states that as a person consumes more units of a good or service, the additional satisfaction or utility gained from each additional unit decreases
What is the Law of Diminishing Marginal Utility?
400
The increase in a country's interest rates affects its currency value in the foreign exchange market
What is Appreciation?
400
The maximum money change, given a reserve requirement of 20% and an initial deposit of $1,000
$4,000.
Money Multiplier = 1 / 0.20 = 5
Initial Deposit × Money Multiplier = $1,000 × 5 = $5,000
Since the bank must hold 20% as reserves,
$5,000 - $1,000 = $4,000.
400
Graph in a recessionary gap
500
The primary goal of contractionary monetary policy
What is reduce inflation by decreasing the money supply and raising interest rates, which curbs consumer spending and investment?
500
A man deposits a $500 check into his time deposit for a course of 5 years, this happens to M1, M2, and M0.
What is M1 decreases(by $500), M2 does not change, M0 does not change?
500
The real interest rate is if nominal interest rate is 8% and the inflation rate is 3%
What is 5%
Real Interest Rate = Nominal Interest Rate - Inflation Rate
(8% - 3% = 5%)
500
On an Aggregate Supply and Demand (AS-AD) graph, what happens to the equilibrium output and price level if the central bank increases the money supply?
Aggregate Demand (AD) curve shifts to the right, leading to a higher equilibrium output and an increased price level.
500
What is Philips Curve Graph?