Economics and finance | Baamboozle - Baamboozle | The Most Fun Classroom Games!

Why do governments worry about indebtedness?

Because too much debt can limit future spending and cause crises.

True or false: A fiscal adjustment means increasing debt.

False (fiscal adjustment = reducing debt/deficits, not increasing them)

True or false: Public finances refer to the money management of private companies.

False (public finances = government money management)

True or false: The Taylor principle says interest rates should rise more than inflation.

True

True or false: Core inflation includes food and energy prices.

False (core inflation excludes food and energy)

Financial strain on government budgets, often from high debt, spending, or falling revenues.

fiscal pressure

A period of economic decline, usually defined as two consecutive quarters of falling GDP.

recession

The state of owing money; the level of debt held by an individual, business, or country.

indebtedness

Fiscal adjustment

Changes in government spending or taxation aimed at reducing deficits and debt.

The financial capacity of a government to increase spending or reduce taxes without jeopardizing its long-term fiscal sustainability or economic stability.

fiscal space

A medium of exchange used to buy goods and services, store value, and measure economic worth.

money

The theoretical interest rate at which the economy is balanced — neither boosting inflation nor slowing growth.

natural rate of interest

assets

Anything valuable that is owned, such as property, stocks, or bonds.

Define "pension'

Regular payments made to retired people, usually funded by employers, governments, or workers’ contributions.

Income received by a government or business, often from taxes or sales.

revenue

Define "GDP"

Gross Domestic Product — the total value of all goods and services produced in a country in a given period.

The total amount a country owes to creditors, built up by borrowing over time.

national debt

A measure of inflation that excludes volatile items like food and energy, showing underlying price trends.

core inflation

An economic rule stating that central banks should raise interest rates by more than the increase in inflation to keep inflation under control.

Taylor principle

Define "tariff-driven inflation"

Rising prices caused by import tariffs (taxes on foreign goods), which make products more expensive.

Define "rate cuts"

Instances when a central bank lowers interest rates.

A request submitted to a lender for a loan to buy real estate, including details of income, debt, and credit history.

mortgage application

The central bank of the United States, often called “the Fed,” responsible for monetary policy.

Federal Reserve

The supply of available workers and the demand for employees, determining wages, employment, and job opportunities.

labour market

Define "inflation target"

The specific rate of inflation that a central bank aims to maintain for price stability.

Define "cause a recession"

To trigger a period of economic decline marked by falling output, rising unemployment, and reduced spending.

The main financial authority of a country that manages monetary policy, issues currency, and regulates banks.

central bank

Define "crush inflation"

To reduce or eliminate rapidly rising prices in the economy, usually by raising interest rates or tightening monetary policy.

Define "interest rates"

The cost of borrowing money, expressed as a percentage of the amount borrowed.