economic policy

Controllable spending

Refers to the portion of a budget that can be adjusted or modified by policymakers.

Deficit

Occurs when expenditures exceed revenues in a budget over a specific period.

Deflation

A decrease in the general price level of goods and services in an economy.

Demand-side economics

Focuses on influencing the economy through changes in government spending, taxation, and borrowing.

Discount rate

The interest rate set by the Federal Reserve for lending to member banks.

Discretionary spending

Government expenditures that can be altered when the budget is being planned.

Eligibility requirements

Criteria that individuals or entities must meet to qualify for certain benefits or programs.

Entitlement benefits

Government payments to individuals who meet specific eligibility criteria.

Estate tax

Tax imposed on the transfer of the estate of a deceased person.

Excise tax

Tax levied on specific goods or services, such as alcohol, tobacco, or gasoline.

Flat tax

A tax system with a constant tax rate applied to all taxpayers regardless of income.

Federal budget

The government's plan for revenue and spending for a fiscal year.

Federal Reserve

The central banking system of the United States responsible for monetary policy.

Fiscal policy

The use of government spending and taxation to influence the economy.

Free Trade

The unrestricted exchange of goods and services between countries without tariffs or quotas.

Gift tax

Tax on the transfer of property by one individual to another while receiving nothing, or less than full value, in return.

Inflation

A general increase in prices and fall in the purchasing value of money.

Interest rate

The cost of borrowing money, usually expressed as a percentage.

Mandatory spending

Government expenditures that are required by law and not subject to the budget process.

Medicare

A federal health insurance program for individuals aged 65 and older.

Monetary policy

The management of money supply and interest rates by a central bank.

OASDI

Old-Age, Survivors, and Disability Insurance program providing benefits to retirees, survivors, and disabled individuals.

Open market operations

The buying and selling of government securities by the Federal Reserve to control the money supply.

Payroll tax

Tax withheld from an employee's salary by an employer to fund social insurance programs.

Progressive tax

A tax system where the tax rate increases as the taxable amount increases.

Public debt

The total outstanding debt of a government.

Recession

A significant decline in economic activity spread across the economy.

Regressive tax

A tax that takes a larger percentage of income from low-income earners than from high-income earners.

Reserve requirement

The amount of funds that a bank must hold in reserve against specified deposit liabilities.

Surplus

Occurs when revenues exceed expenditures in a budget over a specific period.

Supply-side economics

Focuses on stimulating economic growth by increasing the supply of goods and services.

Tariff

A tax imposed on imported goods and services.

Uncontrollable spending

Government expenditures that cannot be easily adjusted, typically due to existing laws or obligations.