1. Promoting Growth and Stability 3.2

2. Tracking The Business Cycle
The business cycle is a period of a expansion followed by a period of contraction.
This can be explained by using:
Macroeconomics
Microeconomics

3. Macroeconomics
Macroeconomics is the study of the behavior and decision making of entire economies.
Think big picture economics

4. Microeconomics
Microeconomics is the study of the economic behavior and decision making of small units.
Think individual businesses

5. Gross Domestic Product
One measure of a nation’s macroeconomy is gross domestic product (GDP).
GDP is the total value of all final goods and services produced in a particular economy.
GDP will tell us if an economy is healthy or unhealthy

6. Government and The Economy
Policymakers pursue three main outcomes as they seek to stabilize the economy.
Employment
Growth
Stability

7. Employment
One aim of federal economic policy is to provide jobs for everyone who is able to work.

8. Growth The economy must grow to provide additional goods and services.
Each generation of Americans strive to do better than previous ones

9. Stability
Stability gives consumers, producers, and investors CONFIDENCE in the economy and in our financial institutions
promoting economic freedom and growth.

10. Technology and The Economy
The government encourages the development of new technologies in several ways.
Technology helps promote economic growth.

11. Encouraging Innovation
Federal agencies fund many research and development projects.
New technology often evolves out of government research – Ex. NASA.
A patent gives the inventor of a new product the exclusive right to produce and sell it for 20 years.