7.1 The national and international economy Flashcards
1
Q
What is aggregate demand?
A
Total planned spending on goods and services produced within the economy
2
Q
What is aggregate supply?
A
The total level of real output that all firms in the economy plan to produce at different average price levels
3
Q
What is fiscal policy?
A
Use of government spending and taxation to achieve government policy
4
Q
What is supply side policy?
A
Government policy which aims to increase the productive potential of an economy
5
Q
What is monetary policy?
A
Use of interest rates and money supply to achieve government policy
