Money
The number of times the average US dollar is spent.
What is the velocity of money?
The type of economic policy controlled by the FED.
What is monetary policy?
What type of policy controls the money supply to influence interest rate and the GDP.
What is monetary policy?
Expansionary Monetary Policy involves _________ (buying/selling) government bonds.
What is buying?
Contractionary Monetary Policy involves _______ (raising/lowering) the discount rate?
What is raising?
The sum of M1 (cash and checking deposits) and near money (assets that can readily be converted into cash)
What is M2?
The Federal Open Market Committee (FOMC) controls _______.
What are open market operations?
The interest rate the FED charges for short-term loans between banks.
What is the discount rate?
Expansionary Monetary Policy involves ________ (raising/lowering) the reserve requirement.
What is lowering?
The line on the AD/AS graph that is shifted from Contractionary Monetary Policy.
The quotient of GDP and money supply.
What is the velocity of money?
The location of the FED's headquarters.
What is Washington D.C.?
The graph of how the money supply relates to nominal interest rate.
What is the money market graph?
What is inflation?
To close an inflationary gap of $500 million using open market operations, the government should _________ (buy/sell $______) worth of bonds
What is selling $500 million?
An example of M3 money not included in M1 and M2.
What is deposits over 100k, certificate of deposits, etc.?
Members of the FED are appointed by the ________.
What is the president?
The reciprocal of the reserve requirement ratio.
What is the money multiplier?
The total increase in GDP with a reserve requirement ratio of 20% and an increase in spending by $100M.
What is $500M?
The value of the dollar _________ with contractionary monetary policy.
What is appreciates?
The product of money supply and the velocity of money.
The central authority of the FED.
What is the Board of Governors?
A shortcoming of monetary policy that fiscal policy also struggles with.
What are time lags?
The two shortcomings that expansionary fiscal policy faces, but don't affect expansionary monetary policy.
What is the net export and crowding out effect?
The ________ curve gets shifted ________ (left/right) in the money market graph in contractionary monetary policy.
What is the money supply curve shifting left?