Unit 2 Vocabulary
Bonds- Loan from an investor with a promise to repay it with interest
Gross Domestic Product- Measures total value of all goods/services made within a
country
Interest Rate- Amount you are charged for borrowing money
Inflation- Rate of increase in prices over time
Consumer Price Index- Measure of the price of a basket of goods/services has changed
time
Unemployment Rate- Percentage of people who are unemployed
Peak- Highest point in the business cycle
Contraction-Process of becoming smaller
Trough- Point in the business cycle where economic activity and prices is at its lowest
Recession- When an economic decline happens and lasts more than a few months
Monetary Policy- Actions to manage the money supply within an economy
Fiscal Policy- Use of gov. spending and taxation to influence an economy
Contractionary- Helps reduce spending
Expansionary-Measures taken to improve economic growth
Taxes- Payment/charge collected by local, state, and national governments
Deficit-A negative balance
Deficit Spending- When a gov. spends more money than it takes in through revenue
Budget-Plan for spending money
Bonds- Loan from an investor with a promise to repay it with interest
Gross Domestic Product- Measures total value of all goods/services made within a
country
Interest Rate- Amount you are charged for borrowing money
Inflation- Rate of increase in prices over time
Consumer Price Index- Measure of the price of a basket of goods/services has changed
time
Unemployment Rate- Percentage of people who are unemployed
Peak- Highest point in the business cycle
Contraction-Process of becoming smaller
Trough- Point in the business cycle where economic activity and prices is at its lowest
Recession- When an economic decline happens and lasts more than a few months
Monetary Policy- Actions to manage the money supply within an economy
Fiscal Policy- Use of gov. spending and taxation to influence an economy
Contractionary- Helps reduce spending
Expansionary-Measures taken to improve economic growth
Taxes- Payment/charge collected by local, state, and national governments
Deficit-A negative balance
Deficit Spending- When a gov. spends more money than it takes in through revenue
Budget-Plan for spending money
