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-How a government taxes and spends money
Fiscal Policy -How a government taxes and spends money
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Government Spending -Government Increases Spending
-Keynesian Economics -Effect on the Economy -Government Decreases Spending
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Taxation -Government Increases Taxes -Effect on the Economy
-Government Decreases Taxes -Supply Side or Trickle Down Economics
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Monetary Policy -How the government regulates the amount of money in circulation -Regulated through the Federal Reserve System -The supply of money can be described as tight monetary policy or easy monetary policy according to the actions of the government
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Interest Rates -Gov’t controls a basic interest charge that is called the discount rate---which is used by banks -Raising Interest Rates (tight monetary policy) -Lowering Interest Rates (easy monetary policy)
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Reserve Requirements -Reserve Requirements are the amounts of money the gov’t requires banks to keep as deposits -Raising Reserve Requirements -Lowering Reserve Requirements
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US Savings Bonds -Government BUYS Bonds back from Consumers
-Government SELLS Bonds to Consumers
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