AD/AS
Philips Curve
Monetary Policy
Fiscal Policy
FOREX
100
What are the shifters for AD?
C + G + I + Xn
100
What is philips curve a mirror of?
AS Curve
100
What are the 3 tools that the government uses for monetary policy?
1. Discount Rate 2. Reserve Ratio 3. Open Market Operation
100
What two tools does the government use in Fiscal Policy?
Government Spending and taxes
100
What two accounts does the U.S use in FOREX
1.Current account 2. Capital Account
200
What are the shifters for AS
IRAP
200
The philips curve shows the relationship between what two concepts?
Inflation and unemployment
200
The money market graph shows the relationship between what two things?
Real Interest Rates and Quantity of Money
200
What is the classical though of economics?
No government Intervention
200
What would happen to the U.S dollar of Japan's income level goes up?
It will appreciate.
300
What is AD
Demand of all goods and services
300
Draw what the philips curve looks like?
show
300
If the US is in a recession, what open market operation would you use and what would happen to the Money Supply?
You would increase the money supply by buying more bonds
300
What is keynesian economics?
Government needs to come in to save their people because the economy will take too long to fix itself
300
What would happen to the U.S Dollar if the interest rate is going up relative to Japan?
It will appreciate
400
What is AS
AS is the supply of all goods and services
400
If there is an inflationary gap, on what side of the LRPC will the point be?
on the left side of the LRPC
400
What are the three shifters for the demand of money?
1. Price level 2. Income 3. Taxation
400
What two things can the government do if the U.S economy is in a recession?
increase spending or decrease taxes
400
What will happen to the U.S Dollar of Japan is in a recession?
It will depreciate
500
What will happen to AD if income goes up?
AD will go up
500
If AS shifts to the left, what will happen to the PC?
It will shift to the right
500
What would happen interest rates, investment and AD if the money supply goes down?
IR will go up, investment will go down and AD will go down
500
The U.S has a 40 billion recessionary gap. MPS is .2. How much should the government decrease taxes by?
10 billion
500
What is the loanable funds market?
It is where businesses and the government borrow money from private banks
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