P4 UTA ECON NOTES

Econometricians

Practitioners who transform economic models into estimable versions.

Keynes - Circular Flow

Describes the movement of money from households to firms to the government and back.

Hayek - Pretense of Knowledge

Criticizes the belief that we can design and control everything in the economy.

Functions of Money

Describes the roles of money beyond being a dollar, including medium of exchange, unit of account, and store of value.

Goldsmith Table

Explains how banks created money by lending out gold receipts.

Central Bank Tools

Tools like reserve ratios and open market operations used by central banks to control the money supply.

Money Definition M1

Includes currency, checkable deposits, and travelers checks.

Money Definition M2

Includes M1 plus near-monies like savings deposits and money market mutual funds.

Federal Reserve

The central bank that controls the money supply and supervises banks.

Interest Rates

The price paid for using money, influenced by tools like open market operations and the discount rate.