How Does the U.S. Economy Work
By Kimberly Amadeo, About.com Guide to US Economy
Answers the question - How Does the U.S. Economy Work. Explains GDP, Recession, Depression and Supply and Demand. Describes Fiscal Policy, including Income and Taxes, Spending, the Budget Deficit and Debt. Explains Monetary Policy, including the Federal Reserve, Interest Rates and Pricing, including Inflation and Deflation. Covers Trade Policy, including the Current Account and Trade Deficits, and Trade Agreements. Describes the Financial Markets.
GDP
The economic indicator for the economy overall is GDP, or Gross Domestic Product. Find out what it is, and what are the components. The economy's growth rate and why it is important. Types of economic growth, including depression, recession and moderate growth.
- What Exactly IS the U.S. Economy?
- What Are the Components of GDP?
- What Is the Difference Between GDP and GDP Growth Rate?
- What Is the Ideal GDP Growth Rate?
- GDP Current Statistics
- What Is a Recession?
- What Is a Depression?
- The Great Depression of 1929 - Could It Happen Again?
- Recession and Depression - What Are They and How to Prepare
Supply and Demand
How supply and demand are the forces which create the U.S. economy. Supply includes inputs, such as labor, capital, and natural resources. Labor includes employment, unemployment, and productivity. Economic outputs are also explained, including products and services. An explanation of both domestic and international demand.
- A Primer on the Role of Supply in the U.S. Economy
- The Power of the U.S. Economy
- Gas and Oil Prices - How Oil Prices Affect Gas Prices
- Employment and Unemployment FAQ
- A Primer on the Role of Demand in the U.S. Economy
Pricing
How pricing impacts the U.S. economy. Frequently asked questions about inflation. What is deflation.
- What Is Inflation?
- How Does Inflation Impact My Life?
- Why Hasn't Inflation Been a Concern Until Now?
- Who Are the Major Players in the Battle Against Inflation?
Fiscal Policy
What fiscal policy is, and how it impacts the U.S. economy. The role of the President, Congress, and the Budget Office (OMB). Federal taxes and other forms of government income, budgeting, and spending.
Monetary Policy
How monetary policy impacts the U.S. economy. The role of the Federal Reserve Board and the U.S. Treasury Department. The Fed's three key economic controls: the Fed funds rate, monetary supply and the use of credit. Alan Greenspan, Ben Bernanke.
- The Federal Reserve System
- The Federal Funds Rate and How It Works
- Current Federal Reserve Interest Rates
- Historical Fed Funds Rates
- Other Federal Reserve Tools and How They Work
- What is Being Done to Control Inflation?
- How Would a Return to the Gold Standard Affect the U.S. Economy?
Trade Policy
How U.S. trade policy impacts the economy. Role of Office of Trade, State Dept., Treasury, President. The World Trade Organization, Doha, sanctions,and trade disputes. NAFTA, CAFTA, Middle Eastern Trade Initiative, ASEAN and APEC. How exchange rates affect trade. The dollar decline. Trade regulation including farm subsidies and tariffs.
Financial Markets
How the financial markets affects the US economy. Explanation of the stock market, mutual funds, hedge funds, bonds and commodities.
- An Introduction to the Financial Markets
- What Are the Components of the Stock Market?
- Stocks and Stock Investing FAQ
- Mutual Funds FAQ
Glossary
Here are some easy-to-understand definitions of terms most commonly used in discussing the U.S. economy. Arranged by sub-topic and in alphabetical order.
