Flashcards on Introduction to Marketing Management
Introduction to Marketing Management for Students
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Macroeconomic Policy & Cycles
69 cards
Card 1
Question: What is countercyclical (proticyclical) policy and what is its main goal?
Answer: Economic policy by governments and central banks to smooth economic cycles by fighting excessive growth and inflation during booms and supporting grow
Card 2
Question: What are the two main areas of countercyclical policy?
Answer: Fiscal policy and monetary policy.
Card 3
Question: Which instruments belong to fiscal policy?
Answer: Changes in government spending and tax policy.
Card 4
Question: What fiscal policy actions are typical during an economic boom?
Answer: Reduce government spending and increase taxes to lower demand and prevent overheating.
Card 5
Question: What fiscal policy actions are typical during a recession?
Answer: Increase government spending (e.g., infrastructure) and cut taxes to raise disposable income and support demand.
Card 6
Question: Which institution controls monetary policy and what does it involve?
Answer: The central bank; it involves changing interest rates and measures affecting the money supply.
Card 7
Question: What monetary policy actions are used during an economic boom?
Answer: Raise interest rates (making loans more expensive) and reduce money supply (e.g., sell government bonds, raise reserve requirements) to curb consumpti
Card 8
Question: What monetary policy actions are used during a recession?
Answer: Cut interest rates (cheaper loans) and increase money supply (e.g., buy government bonds, lower reserve requirements) to stimulate consumption and inv
Card 9
Question: Name the main macroeconomic goals listed in the content.
Answer: High output (growth), high employment (low unemployment), and price level stability in free markets.
Card 10
Question: What are key fiscal policy tools mentioned for affecting output and employment?
Answer: Government spending (Keynesian approach) and optimizing tax rates (supply-side considerations like the Laffer curve).