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INDUSTRY REGULATION: Government regulation of an entire industry. The most common industry regulation has been in airline, railroad, trucking, banking, and television broadcasting. The objective of industry regulation is for a regulatory agency to keep a close eye on an industry's prices and product to ensure that they don't start a monopoly and take advantage of consumers. Unfortunately more than a few of the regulatory agencies have been prone to work too closely with those they regulate, in large part because regulators move freely between industry and agency. The agency often ends up working for the industry and running what is effectively a legal monopoly that raises prices, prevents competition, and gouges consumers.

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Lesson 20: Federal Reserve System | Unit 3: The Fed Pyramid Page: 9 of 20

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The 37 Federal Reserve Banks are responsible for implementing the Fed policies and regulations.

Federal Reserve Banks:

  • Provide banking services for commercial banks.
  • Provide regulatory oversight of commercial banks.
  • Process checks for commercial banks.
  • Get newly printed currency into circulation.
  • Do economic analyses and monitor their district economies.
  • Offer limited services to the public.

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THREE-SECTOR KEYNESIAN MODEL

A Keynesian model of the macroeconomy that includes the three domestic sectors, the household sector, the business sector, and the government sector. This Keynesian model variation adds the government sector (or public sector) to the household and business sectors that make up the two-sector model. This model enables an analysis of government stabilization policies, especially how fiscal policy changes in government purchases and taxes can be used to close recessionary gaps and inflationary gaps. Equilibrium is identified as the intersection between the C + I + G line and the 45-degree line. Two related models are the two-sector Keynesian model and the four-sector Keynesian model.

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Today, you are likely to spend a great deal of time calling an endless list of 800 numbers seeking to buy either a replacement nozzle for your shower or a decorative windchime with plastic . Be on the lookout for the last item on a shelf.
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Okun's Law posits that the unemployment rate increases by 1% for every 2% gap between real GDP and full-employment real GDP.
"The time to repair the roof is when the sun is shining."

-- John F. Kennedy, 35th U. S. president

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