|
|
INCOME-PRICE MODEL: An economic model relating the price level (the price part) and real production (the income part) that is used to analyze business cycles, aggregate production, unemployment, inflation, stabilization policies, and related macroeconomic phenomena. The income-price model, inspired by the standard market model, captures the interaction between aggregate demand (the buyers) and short-run and long-run aggregate supply (the sellers).
Visit the GLOSS*arama
|
|
|
|
|
Lesson Contents
|
|
Unit 1: A Little Magic |
|
Unit 2: Fred Returns |
|
Unit 3: Modern Banking |
|
Unit 4: The Multiplier |
|
Unit 5: Policy | |
|
Money Creation
The magic of money creation as practiced by private banks is the topic of this lesson. While it seems like magic, money creation is a fundamental aspect of fractional-reserve banking. As such, in this lesson we take a look at why and how banks create money (a task they would seem to be the exclusive privilege of government). This examination of money creation provides insight into how government is able to control the economy's money supply. - The first unit introduces the magic of money creation, as practiced by the banking system.
- The second unit presents a hypothetical example of money creation as practiced by Fred the Goldsmith, where the money is different, but the process is comparable to modern banks.
- The third unit of this lesson, then examines a detailed example of how the banking system goes about creating money when it has an injection of excess reserves.
- In the fourth unit, the money creation process is summarized in terms of a deposit multiplier, which a thought or two on how this can be expanded to a money multiplier, which interests government as it seeks to control the money supply.
- The last unit of this lesson examines the money creation process in the context of monetary policies and government control of the money supply.
|
|
|
|
PER UNIT TAX A tax specified as a percentage of the quantity of a good, service, asset, or other activity. Per unit taxes are often imposed on specific goods or markets. A common per unit tax is that levied on gasoline. People pay a given tax for each gallon of gasoline purchased, regardless of the price of gasoline. An alternative is an ad valorem tax, with is a tax specified as a percentage of the value or price of a good.
Complete Entry | Visit the WEB*pedia |
|
|
GRAY SKITTERY
[What's This?]
Today, you are likely to spend a great deal of time looking for a downtown retail store looking to buy either a travel case for you toothbrush or a looseleaf notebook binder. Be on the lookout for malfunctioning pocket calculators.
Your Complete Scope
This isn't me! What am I?
|
|
|
There were no banks in colonial America before the U.S. Revolutionary War. Anyone seeking a loan did so from another individual.
|
|
|
"He, who every morning plans the transactions of the day, and follows that plan, carries a thread that will guide him through a labyrinth of the most busy life." -- Victor Hugo, Writer
|
|
LTT
Long-Term Trend
|
|
|
Tell us what you think about AmosWEB. Like what you see? Have suggestions for improvements? Let us know. Click the User Feedback link.
User Feedback
|
|
