Federal Reserve
What is unemployment?
People who are able and willing to work but cannot find a job
Name an example of a public good or service the government provides
Education, defense, parks, etc
What is one purpose of banking?
Savings, financial advice, loans, withdraws, etc
Is our government in a deficit or surplus?
Deficit
What does the federal reserve control?
Interest rates or money supply
When people are between jobs or entering the workforce for the first time, it is called
Frictional
Are firms and households independent or interdependent?
Interdependent
How do banks earn money?
Interest
Mandatory payments to the government
Taxes
What are the two goals of the federal reserve?
Full employment and stable prices
What type of unemployment happens during a recession when businesses reduce jobs?
Cyclical
What does the government do if they know they are going to increase spending?
Raise taxes
How do banks earn money off of interest?
Charging more interest to borrowers than they pay to savers
How does a government get into long term national debt?
Spending exceeds revenue
What do citizens give the government in exchange for goods and services?
Taxes
Who is not factored into the unemployment rate?
People who have stopped looking for work (discouraged workers)
In the circular flow model, households provide which of the following to businesses?
Factors of production (labor)
What type of bank account should you open for everyday use?
Checking
What does the term "general welfare" mean in the US Constitution?
Government will provide public goods and services.
What is the benefit of having a mixed economy?
Government can provide public goods and services
What is the unemployment rate calculation?
# of unemployment/labor force x 100
What do businesses give households in exchange for their labor in the circular flow model?
Money (in the form of wages)
What do we call the agency that protects deposits in our banks up to 250,000?
FDIC
What is the current debt of the US?
36 trillion