Studied by 3 PeopleTags & Description
Political business cycle
________: The effect on the economy of using monetary or fiscal policy to stimulate the economy before an election to improve reelection prospects.
Short run
________ in macroeconomics: The period of time in which prices do not change or do not change very much.
Long run
________ aggregate supply curve: A vertical aggregate supply curve that reflects the idea that in the ________, output is determined solely by the factors of production and technology.
Tax cuts
________ initially will increase consumer spending and lead to a higher level of GDP.
Liquidity trap
________: A situation in which nominal interest rates are so low, they can no longer fall; also known as the zero lower bound.
Lower interest rates
________ stimulate investment spending and push the economy back toward full employment.
Classical economics
________ is often associated with Says law, the doctrine that "supply creates its own demand ..
Long run
________ in macroeconomics: The period of time in which prices have fully adjusted to any economic changes.
GDP
Wages and prices will fall together during periods of recessions when ________ falls below full employment or potential output.
full employment
Prices are lower and output returns to ________.
Aggregate Demand Curve
_____________________: A curve shows the relationship between the level of prices and the quantity of real GDP demanded.
Short-run aggregate supply curve
__________________________: A relatively flat aggregate supply curve that represents the idea that prices do not change very much in the short run and that firms adjust production to meet demand.
Wage-price spiral
____________: The process by which changes in wages and prices cause further changes in wages and prices.
Long run in macroeconomics
__________________: The period of time in which prices have fully adjusted to any economic changes.
