Download Final test | ECON 201 - Intro Economics: Survey Course and more Quizzes Economics in PDF only on Docsity!
Automatic Stabilizers
In macroeconomics automatic stabilisers work as a tool to dampen fluctuations in real GDP without any explicit policy action by the government. TERM 2
Timing Lags
DEFINITION 2 Recognition lag, Administrative lag, and operational lag can delay a response to an economic problem. TERM 3
Crowding-Out Effect
DEFINITION 3 In economics, crowding out is any reduction in private consumption or investment that occurs because of an increase in government spending. TERM 4
Foreign-Trade Effect
DEFINITION 4 An expansionary policy that boosts interest rates will cause net exports to decline. TERM 5
Supply-side
economics
DEFINITION 5 Supply-side economics is a school of macroeconomic thought that argues that economic growth can be most effectively created using incentives for people to produce (supply) goods and services, such as adjusting income tax and capital gains tax rates, and by allowing greater flexibility by reducing regulation.
President Bush Economic
Stimulus
Cutting Taxes TERM 7
Store of Value
DEFINITION 7 To act as a store of value, a commodity, a form of money, or financial capital must be able to be reliably saved, stored, and retrieved - and be predictably useful when it is so retrieved. TERM 8
M1 Money Supply
DEFINITION 8 Currency in the hands of the public, demand deposits, other checkable deposits, traveler's checks. TERM 9
M2 Money Supply
DEFINITION 9 M1 + time deposits, MMAs, and Money Market Mutual funds. TERM 10
M3 Money Supply
DEFINITION 10 M2 + Large time deposits
College vs. High School Graduate
earnings
TERM 17
Real GDP
DEFINITION 17 Real gross domestic product (GDP) is a macroeconomic measure of the size of an economy adjusted for price changes (that is, adjusted for changes in the value of money: inflation or deflation.) Consumer Expenditures + Investments
- Government Spending + Net Exports. An imperfect measure of society's well-being.
