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Macroeconomic Policy Instruments
Macroeconomic policy instruments are macroeconomic quantities that can be directly controlled by an economic policy maker. Instruments can be divided into two subsets: a) monetary policy instruments and b) fiscal policy instruments. Monetary policy is conducted by the central bank of a country (such as the Federal Reserve in the U.S.) or of a supranational region (such as the Euro zone). Fiscal policy is conducted by the executive and legislative branches of the government and deals with managing a nation’s budget. Monetary policy {{Main, Central bank#Policy instruments Monetary policy instruments are used for managing short-term rates (the federal funds rate and discount rates in the U.S.), and changing reserve requirements for commercial banks. Monetary policy can be either expansive for the economy (short-term rates low relative to the inflation rate) or restrictive for the economy (short-term rates high relative to the inflation rate). Historically, the major objective of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Monetary Policy
Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability (normally interpreted as a low and stable rate of inflation). Further purposes of a monetary policy may be to contribute to economic stability or to maintain predictable exchange rates with other currencies. Today most central banks in developed countries conduct their monetary policy within an inflation targeting framework, whereas the monetary policies of most developing countries' central banks target some kind of a fixed exchange rate system. A third monetary policy strategy, targeting the money supply, was widely followed during the 1980s, but has diminished in popularity since then, though it is still the official strategy in a number of emerging economies. The tools of monetary policy vary from central bank to central bank, depending on the country's stage of development, inst ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Inflation Rate
In economics, inflation is an increase in the average price of goods and services in terms of money. This increase is measured using a price index, typically a consumer price index (CPI). When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduction in the purchasing power of money. The opposite of CPI inflation is deflation, a decrease in the general price level of goods and services. The common measure of inflation is the inflation rate, the annualized percentage change in a general price index. Changes in inflation are widely attributed to fluctuations in real demand for goods and services (also known as demand shocks, including changes in fiscal or monetary policy), changes in available supplies such as during energy crises (also known as supply shocks), or changes in inflation expectations, which may be self-fulfilling. Moderate inflation affects economies in both positive and negative ways ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economy
An economy is an area of the Production (economics), production, Distribution (economics), distribution and trade, as well as Consumption (economics), consumption of Goods (economics), goods and Service (economics), services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with the production, use, and management of resources. A given economy is a set of processes that involves its culture, values, education, technological evolution, history, social organization, political structure, legal systems, and natural resources as main factors. These factors give context, content, and set the conditions and parameters in which an economy functions. In other words, the economic domain is a social domain of interrelated human practices and transactions that does not stand alone. Economic agents can be individuals, businesses, organizations, or governments. Economic transactions occur when two groups or parties agr ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Budget Deficit
Within the budgetary process, deficit spending is the amount by which spending exceeds revenue over a particular period of time, also called simply deficit, or budget deficit, the opposite of budget surplus. The term may be applied to the budget of a government, private company, or individual. A central point of controversy in economics, government deficit spending was first identified as a necessary economic tool by John Maynard Keynes in the wake of the Great Depression. Controversy Government deficit spending is a central point of controversy in economics, with prominent economists holding differing views. The mainstream economics position is that deficit spending is desirable and necessary as part of countercyclical fiscal policy, but that there should not be a structural deficit (i.e., permanent deficit): The government should run deficits during recessions to compensate for the shortfall in aggregate demand, but should run surpluses in boom times so that there is no ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
United States Treasury Security
United States Treasury securities, also called Treasuries or Treasurys, are government bond, government debt instruments issued by the United States Department of the Treasury to finance government spending as a supplement to taxation. Since 2012, the U.S. government debt has been managed by the Bureau of the Fiscal Service, succeeding the Bureau of the Public Debt. There are four types of marketable Treasury securities: #Treasury bill, Treasury bills, #Treasury note, Treasury notes, #Treasury bond, Treasury bonds, and #TIPS, Treasury Inflation Protected Securities (TIPS). The government sells these securities in auctions conducted by the Federal Reserve Bank of New York, after which they can be traded in secondary markets. Non-marketable securities include savings bonds, issued to individuals; the State and Local Government Series (SLGS), purchaseable only with the proceeds of state and municipal bond sales; and the Government Account Series, purchased by units of the feder ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Debt
Debt is an obligation that requires one party, the debtor, to pay money Loan, borrowed or otherwise withheld from another party, the creditor. Debt may be owed by a sovereign state or country, local government, company, or an individual. Commercial debt is generally subject to contractual terms regarding the amount and timing of repayments of #Principal, principal and interest. Loans, bond (finance), bonds, notes, and Mortgage loan, mortgages are all types of debt. In financial accounting, debt is a type of financial transaction, as distinct from equity (finance), equity. The term can also be used metaphorically to cover morality, moral obligations and other interactions not based on a monetary value. For example, in Western cultures, a person who has been helped by a second person is sometimes said to owe a "debt of gratitude" to the second person. Etymology The English term "debt" was first used in the late 13th century and comes by way of Old French from the Latin verb ' ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Taxes
A tax is a mandatory financial charge or levy imposed on an individual or legal entity by a governmental organization to support government spending and public expenditures collectively or to regulate and reduce negative externalities. Tax compliance refers to policy actions and individual behavior aimed at ensuring that taxpayers are paying the right amount of tax at the right time and securing the correct tax allowances and tax relief. The first known taxation occurred in Ancient Egypt around 3000–2800 BC. Taxes consist of direct or indirect taxes and may be paid in money or as labor equivalent. All countries have a tax system in place to pay for public, common societal, or agreed national needs and for the functions of government. Some countries levy a flat percentage rate of taxation on personal annual income, but most scale taxes are progressive based on brackets of yearly income amounts. Most countries charge a tax on an individual's income and corporate income. Cou ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economic Growth
In economics, economic growth is an increase in the quantity and quality of the economic goods and Service (economics), services that a society Production (economics), produces. It can be measured as the increase in the inflation-adjusted Output (economics), output of an economy in a given year or over a period of time. The rate of growth is typically calculated as List of countries by real GDP growth rate, real gross domestic product (GDP) growth rate, List of countries by real GDP per capita growth, real GDP per capita growth rate or List of countries by GNI per capita growth, GNI per capita growth. The "rate" of economic growth refers to the Exponential growth, geometric annual rate of growth in GDP or GDP per capita between the first and the last year over a period of time. This growth rate represents the trend in the average level of GDP over the period, and ignores any fluctuations in the GDP around this trend. Growth is usually calculated in "real" value, which is real v ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Reserve Requirement
Reserve requirements are central bank regulations that set the minimum amount that a commercial bank must hold in liquid assets. This minimum amount, commonly referred to as the Bank reserves, commercial bank's reserve, is generally determined by the central bank on the basis of a specified proportion of Deposit account, deposit liabilities of the bank. This rate is commonly referred to as the cash reserve ratio or shortened as reserve ratio. Though the definitions vary, the commercial bank's reserves normally consist of currency, cash held by the bank and stored physically in the bank vault (vault cash), plus the amount of the bank's balance in that bank's account with the central bank. A bank is at liberty to hold in reserve sums above this minimum requirement, commonly referred to as ''excess reserves''. In some areas such as the euro area and the UK, tightening of reserve requirements in the home country is found to be associated with higher lending by foreign branches. Fo ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Policy
In economics and political science, fiscal policy is the use of government revenue collection ( taxes or tax cuts) and expenditure to influence a country's economy. The use of government revenue expenditures to influence macroeconomic variables developed in reaction to the Great Depression of the 1930s, when the previous laissez-faire approach to economic management became unworkable. Fiscal policy is based on the theories of the British economist John Maynard Keynes, whose Keynesian economics theorised that government changes in the levels of taxation and government spending influence aggregate demand and the level of economic activity. Fiscal and monetary policy are the key strategies used by a country's government and central bank to advance its economic objectives. The combination of these policies enables these authorities to target inflation and to increase employment. In modern economies, inflation is conventionally considered "healthy" in the range of 2%–3%. Add ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Discount Window
Discount may refer to: Arts and entertainment * Discount (band), punk rock band that formed in Vero Beach, Florida in 1995 and disbanded in 2000 * ''Discount'' (film), French comedy-drama film * "Discounts" (song), 2020 single by American rapper Cupcakke Economics and business * Discounts and allowances, reductions in the basic prices of goods or services *Discounting In finance, discounting is a mechanism in which a debtor obtains the right to delay payments to a creditor, for a defined period of time, in exchange for a charge or fee.See "Time Value", "Discount", "Discount Yield", "Compound Interest", "Effici ..., a financial mechanism in which a debtor obtains the right to delay payments to a creditor * Delay discounting, the decrease in perceived value of receiving a good at a later date compared with receiving it at an earlier date * Discount store {{disambiguation ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Federal Funds Rate
In the United States, the federal funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight on an collateral (finance), uncollateralized basis. Bank reserves, Reserve balances are amounts held at the Federal Reserve. Institutions with surplus balances in their accounts lend those balances to institutions in need of larger balances. The federal funds rate is an important benchmark in financial markets and central to the conduct of Monetary policy of the United States, monetary policy in the United States as it influences a wide range of market interest rates. The effective federal funds rate (EFFR) is calculated as the effective median interest rate of overnight federal funds transactions during the previous business day. It is published daily by the Federal Reserve Bank of New York. The federal funds target range is determined by a meeting of the members of the Federal Open Mar ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
