Economics Lecture Review

Flashcards covering key economic concepts discussed in the lecture notes.

M2

A measure of the money supply that includes cash, checking deposits, and easily convertible near money.

FOMC

Federal Open Market Committee, responsible for overseeing monetary policy in the United States.

Quantitative Easing

A monetary policy where the central bank buys financial assets to inject money into the economy.

Seniorage

The profit made by a government by issuing currency, particularly the difference between the face value of the money and the cost of producing it.

Procyclical

Economic indicators that move in the same direction as the economy as a whole.

Business Cycle

The cycle of economic expansion and contraction that occurs over time in an economy.

Sticky Wages

Wages that do not adjust quickly to changes in labor market conditions.

L-shaped Recession

A type of recession characterized by a sharp decline in economic activity followed by a prolonged stagnation.

U-shaped Recession

A recession that sees a decline, then a flat bottom before recovery begins.

V-shaped Recession

A recession that features a sharp decline in economic activity followed by a quick recovery.

Demand-Side Economics

Economic policies aimed at increasing demand for goods and services.

Supply-Side Economics

Economic policies aimed at increasing supply and productivity.

Macroeconomic Aggregates

Variables that measure economic performance at a wide level, such as GDP, unemployment rate, and inflation.

Interest Rate

The amount charged by lenders to borrowers for the use of money, expressed as a percentage of the principal.

Fiscal Policy

Government spending policies that influence macroeconomic conditions.

Monetary Policy

The process by which the monetary authority of a country controls the supply of money.

Consumer Sentiment Index

A measure of how optimistic or pessimistic consumers feel about the overall state of the economy and their personal financial situation.

Co-movement of Macroeconomic Aggregates

The tendency for various economic indicators to move together during the business cycle.