Review Spring 2018 Fiscal|Policy-Economics
a) What is it?
b) What is required to change it?
c) What Stage of the Business Cycle are we in: i. If the Un employment Rate is 15 %, Production/Output is very low and the I nflation
Rate rises at only 1 %
ii. If the Un employment Rate is 2 %, Production/Output is Very HIGH and the I nflation Rate rises at almost 17 %
2. The GDP Expenditure Method GDP = Consumption + Investment + Govt Spending + Net Exports
a) What are the THREE Guidelines for INCLUDING a Good or Service in the 2018 GDP?
b) See the CW
3. The Civilian, Non Institutionalized Labor Force a) How OLD must you be to be INCLUDED in the LF? b) What are the FOUR “Institutions” in which you CANNOT be? c) See the CW
3. The Unemployment Rate a) What must you be doing to be counted as Unemployed?
b) What are the FOUR Categories of Unemployment? c) What is someone called if they have “Given Up” looking for a job?
4. Monetary Policy
a) What is it? b) Who controls it? c) What is required to change it?
5. Monetary Policy II
a) What are the three Uses of Money: b) The characteristics of “good money”: c) What “backs” (gives value) to our money? d) What are the THREE Monetary Policy Tools? (Diagrams from Notes)
i. How is EACH changed during an EXPANSION? (the 1990’s) ii. How is EACH used during a CONTRACTION? (the Great Depression)
6. INFLATION BLS ’ Market Basket
a) What are these purchases supposed to represent? b) What is the BLS attempting to determine?
c) Be able to Calculate the Market Baskets, Inflation Rate and CPI Index Number.
Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation’s economy.
c) If there is twice as much money TODAY as there was FIFTEEN years ago, by what amount must Business owners increase their prices?
d) Which term is used for a rise in the general price level?
