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Texas State University
POSI 2310 FINAL VOCAB Questions and
Answers 2026 Latest Update
fiscal policy— Ans: the use of government spending and revenue collection
to influence the economy
federal budget— Ans: a written document estimating the federal
government's revenue and authorizing its spending for the coming year
national deficit— Ans: The amount of money the federal government
spends beyond what it gathers in taxes.
national debt— Ans: the total amount of money a government owes to
bondholders
multiplier effect— Ans: the idea that every one dollar change in fiscal policy
creates a change greater than one dollar in the national income
supplyside economics— Ans: a school of thought based on the idea that the
supply of goods drives the economy
keynesian economics— Ans: a school of thought that uses demand-side
theory as the basis for encouraging government action to help the economy
automatic stabilizers— Ans: a tool of fiscal policy that increases or
decreases automatically depending on changes in GDP and personal income
prime rate— Ans: the rate of interest that banks charge on short-term loans
to their best customers
federal funds rate— Ans: the interest rate that banks charge each other for
loans
discount rate— Ans: the interest rate that the Federal Reserve charges
commercial banks for loans
© 2026 All rights reserved
Texas State University
POSI 2310 FINAL VOCAB Questions and
Answers 2026 Latest Update
fiscal policy— Ans: the use of government spending and revenue collection
to influence the economy
federal budget— Ans: a written document estimating the federal
government's revenue and authorizing its spending for the coming year
national deficit— Ans: The amount of money the federal government
spends beyond what it gathers in taxes.
national debt— Ans: the total amount of money a government owes to
bondholders
multiplier effect— Ans: the idea that every one dollar change in fiscal policy
creates a change greater than one dollar in the national income
supplyside economics— Ans: a school of thought based on the idea that the
supply of goods drives the economy
keynesian economics— Ans: a school of thought that uses demand-side
theory as the basis for encouraging government action to help the economy
automatic stabilizers— Ans: a tool of fiscal policy that increases or
decreases automatically depending on changes in GDP and personal income
prime rate— Ans: the rate of interest that banks charge on short-term loans
to their best customers
federal funds rate— Ans: the interest rate that banks charge each other for
loans
discount rate— Ans: the interest rate that the Federal Reserve charges
commercial banks for loans
© 2026 All rights reserved
