Terms : Hide Images
| 9596328838 | cyclically adjusted budget balance | An estimate of what the budget ballence would really be if real GDP were exactly equal to potential output | 0 | |
| 9596328839 | Government Debt | Is the accumulations of past budget deficits, minus past budget surpluses | 1 | |
| 9596328840 | Fiscal year | Runs from October 1 to September 30 and is labeled according to the calendar year in which it ends | 2 | |
| 9596328841 | Public debt | Is government debt held by individuals and institutions outside the government | 3 | |
| 9596328842 | Debt GDP Ratio | Is the government's debt as a percentage of GDP | 4 | |
| 9596328843 | Implicit liabilities | Spending promises made by the government that are effectively a debt despite the fact that they are not included in the usual debt statistics. | 5 | |
| 9596328844 | Target Federal funds | A desired level for federal funds rates. The Fed will use open market operations to achieve that target. | 6 | |
| 9596328845 | Expansionary monetary policy | Is monetary policy that increases aggregate demand | 7 | |
| 9596328846 | Contractionary Monetary policy | Policy that reduces aggregate demand |  | 8 |
| 9596368730 | Taylor rule for monetary policy | a rule for setting the federal funds rate that takes in account both the inflation rate and the output gap. | 9 | |
| 9596328847 | Inflationary targeting | occurs when the central bank sets an explicit target for the inflation rate and sets monetary policy in order to hit that target | 10 | |
| 9596328848 | Monetary neutrality | changes in the money supply have no real effects on the economy | 11 | |
| 9596328849 | Classical model of the price level | according to this model the quantity of money is always at its long-run equilibrium level | 12 | |
| 9596328850 | Inflation tax | Is the reduction in the value of money held by the public caused by inflation | 13 | |
| 9596328851 | cost-push inflation | is inflation that is caused by a significant increase in the price of an input with an economy-wide importance | 14 | |
| 9596328852 | Demand pull inflation | Is inflation that is caused by an increase in aggregate demand | 15 | |
| 9596328853 | nonaccelerating inflation rate of unemployment (NAIRU) | the unployment rate at which inflation does not chnage over time. |  | 16 |
| 9596328854 | Long run Philips curve | shows the relationship between unemployment and inflation after expectations of inflation have had time to adjust to experience | 17 | |
| 9596328855 | Debt deflation | Is the reduction in aggregate demand arising from the increase in the real burden of outstanding debt caused by deflation | 18 | |
| 9596328856 | Zero bound | when the nominal interest rate cannot go below zero | 19 | |
| 9596328859 | Monetarism | asserts that GDP will grow steadily if the money supply grows steadily | 20 | |
| 9596328860 | discretionary monetary policy | is the use of changes in rate or money supply to stabilize the economy | 21 | |
| 9596328861 | Monetary policy rule | Is a formula that determines the central bank's actions. | 22 | |
| 9596328862 | Quantity theory of money | Emphasizes the positive relationship between the price level and the money supply M x V = P x Y | 23 | |
| 9596328863 | velocity of money | is the ratio of nominal GDP to the money supply. it is a measure of the average number of times the average dollar bill is spent per year. | 24 | |
| 9596328864 | Natural rate hypothesis | to avoid accelerating inflation over time, the unemployment rate must be high enough that actual inflation rate equals the expected rate of inflation | 25 | |
| 9596328865 | Political business cycle | results when politicians use macroeconomic policy to serve political ends | 26 | |
| 9596328866 | New classical macroeconomics | is an approach to the business cycle that returns to the classical view that shifts in the aggregate demand curve affect only the aggregate price level, not aggregate output | 27 | |
| 9596328867 | Rational expectations | is the view that individuals and firms make decisions optimally, using all available information | 28 | |
| 9596328868 | new Keynesian economics | market imperfections can lead to price stickiness for the economy as a whole | 29 | |
| 9596328869 | real businiess cycle theory | claims that fluctuations in the rate of growth of total factor productivity cause the business cycle | 30 |
