Vocab
Define fiscal policy
Taxing and speeding decisions set by the federal government
Structural unemployment
People no longer fit the job. They do not have the skills.
Economic growth
Slow value of value over time
Reserve requirement
When banks loan more $ consumers get more loans. When the bank loans put less $ it's harder to get a loan
Explain how a budget deficit affects national debt
It adds to the amount
Define government surplus
Government is under budget
Seasonal unemployment
A job based on the season
Full employment
Every one willing to work had the opportunity to
Discount rate
Interest rates that banks are charged when the barrow $
Explain how a budget surplus affects national debt
It takes away from it
Define budget deficit
Government is over budget
Cyclical unemployment
The economy is bad
Stable prices
Prove needs to stay the same so money can keep it's value
Open market operations
Buying and selling treasury securities
Aggregate supply
G/S in the economy available at all price levels
Define national debt
Money owed to the federal government
Frictional unemployment
When a person is in between jobs
How is economic growth calculated
C + I + G + NX = GDP
Interest on reserves
When the interest rates are high money is kept and nine is loaned out
Low interest loan out $ and increase in supply
Aggregate demand
G/S in the economy that will be purchased at all possible price levels
Define monetary policy
regulating the money supply, controlling inflation/deflation, adjusting the interest rates to regulate the economy, the cost of money
Define inflation
Rise on prices
How is full employment calculated
4 and 6 % unemployment
How does the fed. Use discount rate
Fed. Keeps their reserve requirement
Consumer price index
What consumers spend