Econ 3.2

Policymakers pursue all of the following goals to stabilize the economy EXCEPT

stable productivity

technology

the process used to produce a good or service

macroeconomics

the study of the behavior and decision making of entire economies

microeconomics

the study of the economic behavior and decision making of small units, such as individuals, families, and businesses

Gross Domestic Product (GDP)

the total value of goods produced and services provided in a country during one year.

The federal government monitors and regulates American banks and other financial institutions

to shield money from the damaging effects of economic downturns.

business cycle

a period of macroeconomic expansion followed by a period of contraction

Business cycles occur in free enterprise systems because

economic decisions about factors such as prices, production, and consumption are determined by the market.

The government encourages an increased level of productivity by

funding research and development projects at many levels

Improved technology helps create a higher standard of living for future generations by

providing additional goods and services.