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Fiscal Policy/AD&AS
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Marginal Propensity to Consume (MPC)
the change in consumption resulting from a given change in real disposable income
Marginal Propensity to Save (MPS)
the change in saving resulting from a given change in real disposable income
Aggregate Expenditures
represents total spending in an economy at a given level of real disposable income
Says Law
the theory that supply creates its own demand
Autonomous Consumption
consumption that is independent of the level of disposable income
Spending Multiplier
Aggregate-expenditure output model
determines the level of real GDP by the intersection of the aggregate expenditures and aggregate output curves
Recessionary GDP gap
the amount by which aggregate expenditures fall short of the amount required to achieve full-employment equilibium
Inflationary GDP gap
the amount by which aggregate expenditures exeed the amount required to achieve full-employment equilibrium
Stagflation
is an economy experiencing inflation and unemployment simultaniously
Aggregate Demand Curve
shows the level of real GDP purchased in the economy at different price levels during a period of time
Aggregate Supply Curve
shows the level of real GDP that an economy produces at different possible price levels
Fiscal Policy
the federal governments decisions about the amount of money it spends and collects in taxes to achieve fell employment and non-inflationary economy
Budget Surplus
when governments revenues exceed government expenditures
Budget Deficit
when governments expenditures exeed government revenues
Author
Kencollins08
ID
133984
Card Set
Fiscal Policy/AD&AS
Description
Fiscal Policy/AD&AS
Updated
2012-02-09T10:09:04Z
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