Vocabulary

inflation  An increase in the overall price level of goods and services produced in an economy.

economic indicators  Statistics that help economists judge the health of an economy.

gross domestic product (GDP)  The market value of all final goods and services produced within a country during a given period of time. In the United States, GDP is the standard measure of the nation's total production.

unemployment rate  The percentage of the labor force that is not employed but is actively seeking work.

inflation rate  The percentage increase in the average price level of goods and services from one month or year to the next.

consumer price  index (CPI) A measure of price changes in consumer goods and services. The CPI shows changes in the cost of living over time.

business cycle  A recurring pattern of growth and decline in economic activity over time.

recession  A period of declining national economic activity, usually measured as a decrease in GOP for at least two consecutive quarters (six months).



Chapter Sections

14.1 – Introduction
14.2 – What Are the Origins of Modern Fiscal and Monetary Policy?
14.3 – What Tools Does Fiscal Policy Use to Stabilize the Economy?
14.4 – What Tools Does Monetary Policy Use to Stabilize the Economy?
14.5 – What Factors Limit the Effectiveness of Fiscal and Monetary Policy?
Summary


Chapter 14 - Textbook Scan