15-1
What is insurance that workers who lose their jobs through no fault of their own can collect from individual states for a limited amount of time?
unemployment insurance
Supply-siders want to decrease the role of the __________ ____________?
federal government
What focuses on the economy as a whole and decision making by large units?
macroeconomics
What is the price when quantity supplied equals quantity demanded; price that clears the market?
equilibrium price
According to Keynes, which sector was most responsible for the instability that led to the Great Depression?
investment
In the aggregate output-expenditure model model (GDP), C + I + G + (X – M), what does the M stand for?
imports
What is relaxing or removing government regulations that restrict the activities of firms in certain industries?
deregulation
What is the amount of real GDP consistent with a given price level; intersection of aggregate supply and aggregate demand?
What is a hypothetical curve showing different levels of real GDP that would be produced at various price levels?
aggregate supply curve
What is the total value of all goods and services demanded at different price levels?
aggregate demand
What are programs that automatically provide government benefits during an economic downturn?
automatic stabilizers
What is a hypothetical, or possible, relationship between federal income tax rates and tax revenues?
What is the total value of all goods and services that all firms would produce in a specific period of time at various price levels?
aggregate supply
What is the use of government spending and revenue collection measures to influence the economy?
fiscal policy
What did the supply-sided policies do in an effort to allow people to keep more of the money they earn, which would encourage people to work harder?
lower taxes
What is a change in overall spending caused by a change in investment spending?
multiplier
What are economic policies designed to stimulate the economy by removing government regulations and lowering marginal tax rates to increase production?
supply-side policies
Aggregate demand and aggregate supply help us explain what TWO major poblems in macroeconomics?
inflation & recessions
What is a change in investment spending caused by a change in overall spending?
accelerator
What is an approach designed to lower unemployment and raise output by stimulating aggregate demand?
Keynesian economics
What are TWO of the THREE reasons for spending delays?
1.) recognition lag
2.) legislative lag
3.) implementation lag
What were the TWO biggest economic problems that the nation was facing in the 1970s? These problems not being controlled by the demand-side policies led politicians and Americans to want to try something else.
growing unemployment
inflation
If consumers decide to spend more and save less, what curve would shift and in which direction?
aggregate demand curve shifts right
What are program or benefit using established eligibility requirements to provide health care, food, or income supplements to individuals?
entitlements
Keynesian economic policies are designed to lower unemployment by _______
A. stimulating aggregate supply
B. stimulating aggregate demand
C. reducing aggregate demand
D. creating government jobs
B. stimulating aggregate demand