Fiscal Policy
The federal government’s efforts to keep the economy stable by increasing or decreasing taxes or government spending.
What is fiscal policy
The management of the money supply and interest rates by the Federal Reserve Bank
What is monetary policy?
Periodic rises and falls that occur in economies over time.
What is the business cycle?
A market structure where many sellers offer identical products and no single seller dominates.
What is perfect competition?
The study of how scarce resources are allocated to satisfy unlimited wants.
What is the primary focus of Economics?
Taxation and government spending represent what.
What are two tools of fiscal policy?
Decreases interest rates to encourage borrowing and spending.
What action does the Federal Reserve typically take when the economy is in a recession?
Two or more consecutive quarters of decline in GDP.
What characterizes a recession?
A market structure with many sellers offering differentiated products.
What is monopolistic competition?
To optimize inventory levels to meet demand without incurring excess costs.
What is the purpose of Inventory Management in Microeconomics?
The government may increase spending or cut taxes to stimulate the economy.
What happens during a recession concerning fiscal policy?
By managing interest rates and money supply, the central bank can influence inflation rates.
How does monetary policy affect inflation?
A phase of the business cycle is characterized by stabilizing and starting to grow.
What is Recovery?
Sellers lower prices to clear excess supply.
What occurs when quantity supplied exceeds quantity demanded in a free market?
They influence national economic performance and stability.
What is the significance of government economic policies in Macroeconomics?
To stabilize economic fluctuations.
What is the primary goal of fiscal policy?
A responsibility of this organization is to adjust interest rates.
What is the central bank?
Define a depression in economic terms.
What is a severe recession?
What type of competition involves a few sellers dominating the market?
What is oligopoly?
Economic systems, government policies, and socio-economic organizations.
What is the external factors that influence Business Economics?
Fiscal policy can reduce unemployment by stimulating economic growth through increased government spending.
What is how does fiscal policy impact unemployment?
By managing interest rates and money supply, the central bank can influence inflation rates.
What is monetary policy's impact on inflation?
A phase in the business cycle where the economy experiences high growth and employment.
What is an economic boom?
A market structure where only one seller controls the entire market.
What is a monopoly?
To make informed decisions based on the economic environment they operate in.
What is why is it important for businesses to understand economic cycles?