Macroeconomic Aims
What are "macroeconomic aims"?
The big goals a country's government tries to achieve for their overall economy.
What is "fiscal policy"?
Government strategies involving spending and taxation to influence the economy.
What is "monetary policy"?
Central bank actions that manage the money supply and interest rates to influence the economy.
What is "inflation"?
A general increase in prices and fall in the purchasingvalue of money.
What is "deflation"?
A general decrease in prices, often associated withreduced consumer spending.
What are some macroeconomic aims?
Economic growth, low-unemployment, and price stability.
True or False: Fiscal Policy influences interest rates.
True or False: Monetary Policy involve central bank actions.
TRUE.
How does inflation effect the economy?
It increases the prices of goods and services in an economy.
What is the summary word for economics?
CHOICES.
Which macroeconomic aim allows more people to earn income?
Low-unemployment.
To create a balance between resources.
What is the role of central banks in setting monetary policy?
To achieve economic goals.
What does 0% inflation lead to?
DEFLATION.
Name a well known central bank in the United States:
the Federal Reserve.
Economic growth.
How does lowering taxes affect an economy?
How do high interest rates affect a persons borrowing?
People borrow less when interest rates are high.
How is deflation indicated?
By an inflation rate that falls below zero percent.
What is an example of a deflation around the year 1930?
the Great Depression
Does focusing on a small handmade bakery shop count as a macroeconomic aim?
NO.
How does a government control spending for an economy?
Lowering unemployment rates and adjusting taxation.
What is a monetary policy's main objective?
To achieve price stability.
Which sectors benefit from inflations?
Energy, transportation, technology, etc.
What is the difference between macroeconomics and microeconomics
Macroeconomics focuses on the economy as a whole, and microeconomics focuses on smaller firms.