2.6.2- Demand Side Policies UNFINISHED Flashcards
1
Q
What is a demand side policy?
A
Policies designed to manipulate consumer demand
2
Q
What is monetary policy?
A
Control of the money supply by altering interest rates and quantative easing to control the level of AD
3
Q
What does the money supply include?
A
-narrow money
-broad money
4
Q
What is narrow money?
A
Notes and coins in circulation
5
Q
What is broad money?
A
Narrow money+ bank balances + credit
6
Q
What is fiscal policy?
A
Use of borrowing, gov spending and taxation to manipulate the level of AD and improve macroeconomic performance
7
Q
Who controls interest rates in the UK?
A
The monetary policy committee
8
Q
What is the monetary policy committee?
A
Nine members who meet each month independent from the government to discuss what the rate of interest should be
