Gov fiscal and monetary policy

Expansionary policies

the government trying to boost economy

Contractionary policies

reducing government spending to try and lower the economy and inflation

Fiscal policy

the use of government spending and taxing to help the economy

Monetary policy

a set of tools used by a nation's central bank to control the money supply and credit conditions, aiming to promote economic growth, stable prices, and maximum employment. 

Progressive tax

your tax increases the more money you make

Regressive tax

higher earning could pay lower tax

Flat tax

same tax rates to all

inflation

as demand for things increases the prices go up that means money is worth less

US Securities being sold

IOUs delivered to people willing to lend the government the money

US Securities being sold if the economy goes down

If this goes down there is more money in peoples hands

US Securities being sold if the economy goes up

More are sold meaning less money are in peoples hands that means lower money supply

Discount rate

% interest to charge banks for government loans

discount rate if the economy goes up

High % tax on loans meaning less loans meaning less loans to people

discount rate if the economy goes down

Less of a tax more loans

Reserve Requirement %

% of money banks must keep in there vaults

Reserve Requirement % goes up

Less money loaned out to the people

Reserve Requirement % goes down

More money allowed to be taken out more loans for people

The primary responsibility for determining monetary policy in the US rests with the

Treasury department

what is the feds relationship with the president and the people

They are independent