GDP & Economic Growth
This measures the total market value of all final goods and services produced within a country in one year.
What is GDP?
A sustained increase in the general price level is called this.
What is inflation?
This branch of government controls fiscal policy.
What is Congress/the federal government?
This institution is the central bank of the United States.
What is the Federal Reserve System?
This account records trade in goods and services.
What is the current account?
This type of GDP is adjusted for inflation.
What is real GDP?
This index is most commonly used to measure inflation experienced by consumers.
What is the Consumer Price Index (CPI)?
An increase in government spending is considered this kind of fiscal policy.
What is expansionary fiscal policy?
When the Fed buys bonds, the money supply will generally do this.
What is increase?
When a country imports more than it exports, it has this.
What is a trade deficit?
This occurs when an economy’s actual output exceeds its potential output.
What is an inflationary gap?
This type of unemployment occurs when workers are between jobs.
What is frictional unemployment?
When government spending exceeds tax revenue, this occurs.
What is a budget deficit?
This is the interest rate banks charge each other for overnight loans.
What is the federal funds rate?
If the U.S. dollar strengthens, U.S. exports will generally do this.
What is decrease?
The formula for GDP using expenditures is C + I + G + this.
What is net exports (X − M)?
This type of inflation is caused by rising production costs.
What is cost-push inflation?
This effect occurs when government borrowing raises interest rates and reduces private investment.
What is crowding out?
This term describes money being used more frequently in transactions.
What is velocity of money?
This policy places taxes on imported goods.
What are tariffs?
This curve shows combinations of two goods an economy can produce efficiently.
What is the Production Possibilities Curve (PPC)?
The unemployment rate equals the number of unemployed divided by this.
Taxes and unemployment benefits are examples of these.
What are automatic stabilizers?
The percentage of deposits banks must keep on hand is called this.
What is the reserve requirement?
This market determines exchange rates between currencies.
What is the foreign exchange market?