1.3 Managing the Economy

Fiscal Policy

Economic policy that involves government spending and tax considerations; managed by Congress and the President.

Monetary Policy

Economic policy that involves regulation of the money supply, primarily managed by the Federal Reserve Board to adjust interest rates.

Keynesian Economics

An economic theory advocating for government intervention through spending to stimulate the economy during downturns, and reducing spending during booms.

Supply-Side Economics

An economic theory that tax cuts can stimulate business investment and economic growth, with lower taxes potentially leading to higher overall tax revenues.

Monetarism

An economic theory emphasizing the importance of controlling the money supply as a means to regulate economic health, as opposed to fiscal policy.

New Deal

A series of programs and policies implemented by President Franklin D. Roosevelt during the Great Depression to promote economic recovery.

Employment Act of 1946

Legislation that made the federal government responsible for promoting high employment rates.

Great Depression

A severe worldwide economic crisis during the 1930s, characterized by high unemployment and economic stagnation.