2. What’s a Gross Domestic Product? Broccoli? I was gonna say “Preparation H.” So – “gross” means broccoli, Preparation H, and the “entire sum of all products produced in a year” from apples to zucchini. Incidentally, applying “Preparation H” below the eyes, will take away puffiness under your eyes.

3. U.S. China Japan Germany France U.K Brazil Italy India Canada Russia Spain Mexico South Korea Australia 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Comparative GDPs in Trillions, 2010 14.5 5.8 5.4 1.5 1.5 2.2 2.5 3.3 2.0 2.0 1.4 1.4 1.4 1.0 1.0 924 1.7 http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nom inal)

5. U.S. China Japan Germany France U.K Brazil Italy India Canada Russia Spain Mexico South Korea Australia 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Comparative GDPs in Trillions, 2010 14.5 5.8 5.4 1.5 1.5 2.2 2.5 3.3 2.0 2.0 1.4 1.4 1.4 1.0 1.0 924 1.7 http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nom inal) Calif. 1.9 TX 1.1 TX 1.1

8.  The use of government spending and taxation to influence the economy  When the economy begins to suffer from serious recession or inflation, politicians will almost always intervene to try to improve the situation. Their interventions may or not be good economics…often they're not…but you can hardly blame the politicians for trying. Nobody wants to go down in history like Herbert Hoover, the president who became a widely hated figure for failing to use the government aggressively enough to try to end the Great Depression.

9.  Falls into two broad categories:  Expansionary Policies-increased government spending & reduced taxes to increase aggregate demand  Contractionary Policies-decreased government spending & increased taxes to decrease aggregate demand

10.  Difficulties exist in using fiscal policy to maintain economic stability & foster economic growth.  Much government spending is fixed (entitlement programs such as welfare, Social Security, Medicare)  Only a small portion of the federal government’s budget is discretionary (available for use as needed or desired)

11.  Predicting the impact of spending and taxing is difficult as is predicting future economic performance  Government spending & taxing doesn’t produce immediate results  Economic conditions may change  Expansionary policies could result in inflation  Contractionary policies could result in recession

12.  Coordinating federal spending & taxing w/ monetary policy & w/ state policies is difficult & may be contradictory  Fiscal policy is subject to political pressures  In the past, expansionary policies have tended to be popular & contractionary policies have tended to be unpopular

13.  The imposition of government regulations may foster economic benefits  prohibiting unfair business practices  providing consumer protections  Government regulations may also carry costs  Reduced corporate profits  Slower economic growth

15. TAXES