Ch 11: Contractionary & Expansionary Gaps

About This Chapter

Learn what contractionary and expansionary gaps are, their causes and impact. Get information on measuring the size of these gaps and see how it affects the central bank.

Contractionary & Expansionary Gaps - Chapter Summary

This chapter's lessons will show you what happens when an economy is performing below or beyond its bounds, conditions economists refer to as contractionary and expansionary gaps. Our instructors will explain how to measure these gaps, and how this information helps the central bank. After completing the lessons in this chapter, you should be able to:

  • Describe the effects of an economy that is below potential
  • Measure the size of contractionary gaps
  • Explain the impact of an economy that is beyond its potential
  • Determine the size of expansionary gaps
  • Report how knowing the size of these gaps can help the central bank

These lessons are each accompanied by short multiple-choice quizzes that let you assess what you've learned. Video tags make it easy to go back and review areas that are giving you trouble. Our instructors are experts in the field, and if you need more help, you can contact them.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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