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AP Macro Review Flashcards | StudBud
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AP Macro Review
AP Macro Review
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review of fundamentals for AP Macroeconomics #apmacroeconomics
Flashcards
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Questions
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Answers
1
Which of the following Fed actions represents an expansionary use of open market operations?
Lowering the discount rate
Raising the federal funds rate
Purchasing securities
Lowering the reserve requirement
2
The CPI rises from 202 to 206. What is the inflation rate?
2%
206%
4%
6%
3
Stagflation can be illustrated on the AD-AS model as
demand pull inflation
cost push inflation
supply side disinflation
4
Contractionary monetary policy will have the following effect:
Decreasing government spending
Decreasing the deficit
Decreasing savings rates
Decreasing lending activity
5
Enos from the Dukes of Hazzard is a graduate of this university
Harvard
UGA
Florida
Auburn
6
Who, among the following, is the tallest economist?
Paul Volcker
Milton Friedman
John Maynard Keynes
John Kenneth Galbraith
7
Inflation is a rise in:
Output
Unemployment
currency value
Price Level
8
Demand deposits = $200,000; reserve requirement = 10%. What's the value of required reserves?
$180,000
$2,000
$200,000
$20,000
9
Expansionary fiscal policy typically causes the following
all of the above
budget deficits
decreased employment
decreased output
10
Given a population of 250 with 100 employed at 25 unemployed, calculate the unemployment rate
20%
25%
50%
10%
11
Academy Award Winner Octavia Spencer is a graduate of this esteemed university
USC
Julliard
Harvard
Auburn
12
Tim Cook, CEO of Apple, is a graduate of this esteemed university
Notre Dame
Yale
Auburn
Harvard
13
rr=10% and the Fed buys $5,000 in bonds. Calculate the max potential change in money supply.
$45,000
$50,000
$4,500
$5,000
14
The unemployment rate at full employment output is called
Natural Rate of UE
Frictional Rate of UE
Cyclical Rate of UE
Structural Rate of UE
15
The relationship between Yd and C (seen on the consumption fxn) can be identified as
Negative
Positive
Inverse
Unrelated
16
Which of the following will follow an increase in interest rates
Decrease in government spending
Decrease in money supply
Decrease in SRPC
Decrease in gross private domestic investment
17
An increase in productivity will increase ___________
PPC (shift outward)
Economic Growth rates
LRAS (shift right)
Potential Output
18
Money Supply = $1,000; Nominal GDP = $5,000. Calculate the velocity of money.
1/5
5
There's no such thing as "velocity of money"
Cannot be determined
19
Professional golfer Jason Dufner is a graduate of this esteemed university
Oklahoma State
LSU
UGA
Auburn
20
The fraction of marginal income which is saved is called
APC
MPS
APS
MPC
21
Which of the following is a reason why AD is downward sloping?
Wealth effect
Income effect
Substitution effect
DMU
22
The SRPC illustrates the ________ relationship between inflation and unemployment
non-existent
Direct
Positive
Inverse
23
Contractionary fiscal policy may be implemented by which of the following?
Sale of bonds on the open market
Raising the discount rate
Raising tax rates
Raising the reserve requirement
24
The long-run occurs...
when resource prices, capital stock, and tech are fixed
when resource prices, capital stock, and tech are flexible
After six months
when we're all dead
25
Which of the following is not one of the functions of money?
Store of value
Standard of value
Portability
Medium of exchange
26
Marist buys a villa in Florence, Italy, for retreats. On the US balance of payments, this is a
credit to the current account
debit to the current account
credit to the financial account
debit to the financial account
27
Given an MPC of 0.75, predict the effect on output of a $100 increase in government spending
+$300
+$400
-$400
-$300
28
US can produce 10 cars or 20 phones in an 8 hour day. Calculate the opportunity cost of a car.
0.5 cars
0.5 phones
2 phones
2 cars
29
Interest rates in the US rise while they fall in England. As a result:
$ appreciates, £ depreciates
$ depreciates, £ depreciates
$ appreciates, £ appreciates
$ depreciates, £ appreciates
30
i ↑ I ↓ __________↓ Productivity ↓ Economic growth rate ↓
Capital Formation
AD
r
Technology
31
2% of the workforce moves from full time to part time employment. What happens to the UR?
Indeterminate
Down 2%
No Change
Up 2%
32
Nominal interest rate = 5%, real interest rate = 2%. What is expected inflation rate?
3%
7%
10%
-3%
33
Nominal income = $1,200 and the GDP price deflator is 120. Calculate real GDP.
$100
$10
$1,000
$144,000
34
During a recession, national income will
Stay the Same
Increase
Decrease
The change in indeterminate
35
Assets = Liabilities + _________
Owners' Equity
Capital
All of the Above
Net Worth
36
Amazon sells 250 books to a library in Canada. This is a __________ to the U.S. current account
credit
subtraction
capital
debit
37
A federal budget deficit potentially increases interest rates, _______ ____ private investment
crowding in
trickling down
rocket fueling
crowding out
38
Which of the following is not included in the calculation of M1?
$1000 stored in a checking account
$5000 traveler's check
$4000 in a savings account
$5 bill
39
rr=10% and you deposit $100 cash in a bank. Calculate the max potential change in money supply.
$1000
$90
$100
$900
40
$1,000 is moved from savings to checking. M1 will _____ and M2 will _____.
increase; remain the same
remain the same; decrease
decrease; increase
increase; decrease
41
With Y>Yf, long-run self-cxn occurs as Wn ↑ causing ________ to decrease
SRPC
LRAS
AD
SRAS
42
Reserve requirement = 10%. XR = $100,000. Calculate the amount available for new loans.
$100,000
Indeterminate
$10,000
$90,000
43
Generally speaking, who gains from unanticipated inflation?
Borrowers at an adjustable rate
Indeterminate
Borrowers at a fixed rate
Lenders at a fixed rate
44
On a simple circular flow model, businesses are suppliers in the _________ market
factor
resource
product
financial
45
The LRPC is vertical and intersects the x-axis at ________
All of the Above
Zero Cyclical UE
NAIRU
NRU
46
This shifts both SRAS and LRAS to the right
All of the above
Development of human capital
Productivity
New technologies
