Unit 22-23
What is consumer spending?
What households spend on finished goods and services
What is unemployment rate?
The percentage of a workforce who is willing and able to work but is unable to find a job
What is Federal Reserve System?
The central bank of the United States.
What is Deficit?
When the amount of income is less than the expenses paid in a given year.
What is Inflation?
Sustained increase in the price of goods and services over time.
What are the four types of unemployment?
Cyclical, Frictional, Seasonal and Structural Unemployment.
What is full employment?
The state of the economy when almost everyone who is willing and able to have a job has the opportunity to do so
What is Federal Open Market Committee (FOMC)?
The monetary policy making branch of the Federal Reserve System.
What is a Surplus?
When the amount of income is greater than the expenses paid in a given year.
What is the 12 District Banks?
Regionally located banks used to provide support for commercial banks within their district.
What is Consumer Price Index?
A statistic used to measure the change in prices over time. Tracked monthly using a standard “market basket” of goods
What are the four stages of the business cycle?
Peak, Recession, Trough, and Expansion
What is Store of Value mean?
Money saved now will be available to use in the future for purchases.
What is National Debt?
Interest paid to commercial banks on deposits they make in the Federal Reserve.
What is Discount Rate?
The interest rate charged by the Federal Reserve to commercial banks for loans.
What is Price Stability?
Minimizing increases in the level of prices over time so a country’s money will retain its purchasing power.
What is Structural and Cyclical unemployment?
Cyclical: Unemployment created by changes in the business cycle.
Structural: Unemployment created by the structure of the workplace changing the needs for workers
What is Unit of Account?
Money allows people to compare prices and values of items using a standard value (currency)
What is Interest on Reserves?
Interest paid to commercial banks on deposits they make in the Federal Reserve.
What is Government Spending?
The amount of money that federal, state and local governments spend on finished goods and services.
What is Gross Domestic Product?
Economic indicator that is the sum of consumer spending, investment spending, government spending, and net export
What is Frictional and Seasonal unemployment?
Frictional: Unemployment created by graduating from high school or college or looking for a better job.
Seasonal: Unemployment created by changing seasons. Employers only need workers during certain periods of the year.
What does Medium of Exchange mean?
Money facilities transactions between individuals, businesses, financial institutions, and governments in an economy
What is Monetary Policy?
The Federal Reserve’s actions, as a central bank, to achieve the three goals of maximum employment, stable prices and moderate long-term interest rates.
What is Federal Deficit?
How much over budget the Federal government is during one year.