Key Economic Indicators
Measures how many people are looking for a job but haven't found one yet
Unemployment Rate
Business cycle phase featuring increasing consumer demand, increased production, low unemployment but an upward pressure on prices
Expansion or recovery/expansion
How does the Federal Reserve try to help the economy?
Monetary Policy
Type of monetary policy used during an expansion to manage inflation
Contractionary money policy
Fiscal policy tools to help manage inflation
Raise taxes
Lower government spending
Definition of GDP
Total dollar value of final goods and services produced within a country's borders in a given year
Phase in the business cycle featuring increased unemployment
Contraction
What is monetary policy?
Managing the supply of money in the economy
Type of monetary policy used to improve employment
Expansionary monetary policy
Fiscal policy tools to help economy during a business cycle contraction
Lower taxes
Increase government spending
Utilizes a 'market basket' to measure prices
Consumer Price Index
Business cycle phase featuring the highest prices and employment
Peak
Federal Reserve is managed by?
Board of Governors
Four things the Fed can do to manage inflation and avoid getting to the business cycle peak
Sell bonds
Raise the reserve requirement
Raise the discount rate
Raise the interest rate on additional reserves
Who is primarily responsible for fiscal policy
Congress
Most accurate measure of actual productivity in an economy
Real GDP
When prices are so low consumers are tempted to start spending again
Trough
Number of Federal Reserve District Banks?
Twelve
Four tools the Fed can use to boost the economy and help with unemployment
Buy bonds
Lower the reserve requirement
Lower the discount rate
Lower the interest on additional/excess reserves
Annual budget shortfall
Budget deficit
How do we measure standard of living?
GDP per capita
What does the Business Cycle measure?
Part of Federal Reserve which is the most active on a day to day basis
Federal Open Market Committee
The Federal Reserve Dual Mandate
Stable inflation
Maximize employment
Cumulative amount of money our country owes
National debt