Which would NOT a cause a new business cycle?

Stock market hits a record high

studbud

QCA 2 Review

148 termsStudBud Administration207 plays

This Quiz is designed to review all the material that McKinney Boyd Economics classes learn in the 2nd semester.

Flashcards148 cardsFPractice quizPHost liveL

Questions 148

Answers

1
This is a representative selection of commonly purchased goods and services by an urban family
Bread Basket
Market Basket
Consumer Price Index
Nominal GDP
2
When a change in investment spending influences consumer spending, reducing total spending
Accelerator Effect
Exponential Effect
Magnified Effect
Multiplier Effect
3
Coins count toward M1
True
False
4
By holding prices constant, it helps us rule out inflation as a cause for increased GDP
True
False
5
This branch of economics looks at the economy as a whole, from a big-picture perspective
Microeconomics
Macroeconomics
Classical Economics
Keynesian Economics
6
Corporate Income Taxes get paid to the
State government
County government
Federal government
Local government
7
This kind of tax is charged to individuals who earn a profit from selling real property
Capital Gains Tax
Proportional Tax
Regressive Tax
Progressive Tax
8
The Civilian Labor excludes
Incarcerated Individuals
Members of the military
Mental Health facility patients
All of the Above
9
The Fed was created in
1913
1943
1887
1933
10
Technological Unemployment occurs when workers are replaced by machines or automated systems
Structural
Frictional
Seasonal
Cyclical
11
Which is NOT a Supply-Side Policy?
Deregulation
Decreased Economic Role for Government
Lower Federal Taxes on Individuals & Businesses
Entitlement Programs
12
Banks pay customers interest on this kind of account
Money Market Account
Certificates of Deposit
All of the Above
Savings Account
13
The purchase of all goods and services are taxed, benefitting state governments
Inheritance Tax
Property Tax
Sales Tax
Capital Gains Tax
14
If Nominal GDP increases by 20% and inflation increases by 5%, Real GDP grows by
15%
20%
5%
10%
15
The sum of all outstanding obligations by the United States
National Debt
Balanced Budget
US Savings Bond
National Deficit
16
The Fed rarely uses this tool to alter the money supply
Prime Rate
Discount Rate
Reserve Requirement
Open Market Operations
17
This group of 7 individuals oversee the Fed
Board of Governors
Advisory Committee
Regional Banks
Federal Open Markets Committee
18
This kind of tax imposes a higher tax burden on lower income individuals
Progressive Tax
Regressive Tax
Proportional Tax
Capital Gains Tax
19
Deposit=$12,000. RR=8%. How much are Excess Reserves?
$150,000
$11,040
$960
$1,500
20
Keynes determined this variable in the Output-Expenditure Model caused the global depression
G
I
C
(X-M)
21
When banks lend out money, the economy's money supply shrinks
False
True
22
Which of the following is NOT a criteria for effective taxation?
Efficient
Biased
Equitable
Simple
23
Rising input costs drive up production costs, which increases the prices of products
Demand-Pull
Wage-Price Spiral
Cost-Push
Excessive Monetary Growth
24
Which of the following is NOT a way that state governments collect money?
Sales Taxes
Intergovernmental Revenues/Transfers
Property Taxes
Individual Income Taxes
25
Economists compare prices of goods and services in only the Northeast region of the country
False
True
26
Keynes advocated for this Sector to act as a counter-balance to the Investment Sector
Net Foreign Sector
Import Sector
Consumer Sector
Government Sector
27
The amount of a deposit that the bank loans out to other customers
Excess Reserve
Discount Rate
Interest Rate
Legal Reserve
28
Which would NOT a cause a new business cycle?
Fed employs a tight money policy
Investment sector spending slows
Stock market hits a record high
Terrorist attack in the US
29
Gunpowder, Corn, and Musket Balls are examples of this kind of money
Fiat Money
Specie
Commodity Money
Barter
30
Each time a bank lends money to a customer, the money supply gets larger
True
False
31
A policy where the Fed expands the money supply, interest rates fall, and spurs the economy
Easy Money
Fixed Money
Specie
Tight Money
32
A security where BIG money is loaned for a set period of time for a set amount of interest
Certificates of Deposit
Stocks
Mutual Funds
Bonds
33
When the Fed buys bonds, it increases the money supply
True
False
34
When government expenditures are greater than revenue collections in a single budget year
Budget Deficit
Budget Surplus
Borrowing Rate
National Debt
35
GDP stands for
Gross Demand Percent
Goods Directly Produced
Goods Demanded Periodically
Gross Domestic Product
36
An alternative tax plan where Warren Buffet would pay the same tax rate as his secretary
Value-Added Tax
Progressive Tax
Regressive Tax
Flat/Fair Tax
37
Regular ups and downs of Real GDP describes
business fluctuations
unemployment
inflation
business cycle
38
The absolute lowest interest rate that a bank will charge its BEST customers (w/ good credit)
Reserve Requirement
Discount Rate
Excess Rate
Prime Rate
39
Our basic unit of currency in the US
Certificate of Deposit
Federal Reserve Note
Penny
Gold Standard
40
There is a lag time (delay) for economists to know how the economy is actually performing
False
True
41
Inflation hurts banks b/c loans are repaid later with dollars that buy less
True
False
42
A "good" unemployment rate is between
1 & 3 percent
4 & 6 percent
3 & 8 percent
2 & 5 percent
43
Workers demand higher wages due to increased prices; which in turn leads to more higher prices
Demand-Pull
Wage-Price Spiral
Excessive Monetary Growth
Cost-Push
44
This tool to alter monetary policy involves the Fed purchasing government securities
Discount Rate
Open Market Operations
Reserve Requirement
Prime Rate
45
M2 includes
Money Market and Mutual Fund Accounts
Savings Account Deposits
All of the Above
All of M1
46
Deposit=$10,000. RR=15% . How much are legal reserves?
$150
$667
$8,500
$1500
47
The ability of money to be accessed quickly and efficiently whenever the depositor requires
Reserve Requirement
Certificate of Deposit
Money Market Account
Liquid
48
Raising the discount rate causes more banks to want to borrow money, and spurs the economy
False
True
49
Money is in limited supply
Scarcity
Portability
Duruability
Divisibility
50
A consequence of inflation is that people change their spending habits. This describes
Distorted distribution of income
Distorted spending patterns
Reduced purchasing power
Market Speculation
51
When the Fed buys government securities, it decreases the circulation of bonds
False
True
52
The ability of money to withstand constant exchange without becoming mutilated and worn
Scarcity
Spendibility
Portability
Durability
53
Goods that are components of other final goods and aren't included in the GDP
Nonmarket Transactions
Secondhand Sales
Intermediate Products
Underground Economy
54
unemployment caused by annual changes in the weather or other conditions
Seasonal
Cyclical
Frictional
Structural
55
Which is NOT liquid money?
Currency
Demand Deposits
Traveler's Checks
Small-Time Deposits
56
Which of the following was NOT a Chairman of the Federal Reserve?
Alan Greenspan
Ben Bernanke
John Maynard Keynes
Janet Yellen
57
Deposit= $720. RR= 24%. What is the Excess Reserve?
172.8
30
8.33
547.2
58
GDP= C + I + G + (X-M)
Unemployment Rate
Inflation Rate
Output-Expenditure Model
Expenditure Stabilizer Theory
59
The amount or fee that is charged to a borrower of a loan
Interest Rate
Excess Reserve
Legal Reserve
Discount Rate
60
This kind of tax imposes a higher percentage tax rate on higher income individuals
Regressive Tax
Progressive Tax
Proportional Tax
Inheritance Tax
61
When measuring the money supply, the Fed considers
M1
All of the Above
M2
M3
62
No new production occurs when products already exist, so these aren't included in GDP
Nonmarket Transactions
Secondhand Sales
Intermediate Goods
Underground Economy
63
What does a fractional reserve system mean?
Banks use cash and debit transactions
Banks report daily to the Federal Reserve
Banks keep a small portion of deposits & loan the rest
Banks use fiat money as well as coins
64
Which of the following is NOT a major limitation of demand-side policies?
Increased government spending
Lag Times
Dependency on the government
Deregulation
65
When a change in investment spending reduces total spending, causing investors to invest less
Magnified Effect
Multiplier Effect
Accelerator Effect
Exponential Effect
66
A policy where the Fed decreases the money supply, interest rates go up and discouraging loans
Easy Money
Tight Money
Fixed Money
Commodity Money
67
The Fed is owned by
Member Banks
The Public
Congress
The President
68
The ability of money to be accepted by all parties in a transaction
Portability
Store of Value
Medium of Exchange
Measure of Value
69
This tax is charged to individuals who receive money or real property from dead relatives
Inheritance Tax
Proportional Tax
Sales Tax
Capital Gains Tax
70
Economists use a scientific sampling technique to estimate a country's GDP
False
True
71
The Federal Reserve is affiliated with the Republican Party.
False
True
72
The ability to break a currency down into smaller portions
Durability
Divisibility
Portability
Spendibility
73
The belief that people should be taxed on their ability to pay, regardless of benefits received
Ability to Pay Principle
Efficiency Principle
Equity Principle
Benefit Principle
74
The amount of a deposit to be set aside in legal reserves is determined by
Fractional Reserve
Money Multiplier
Reserve Requirement
Member Bank Reserves
75
The federal government's largest expenditure is
Social Security
Education
Medicare
National Defense
76
Who is responsible for Monetary Policy?
The Supreme Court
The President
Congress
The Federal Reserve
77
unemployment directly related to swings in the business cycle and the result of recessions
Cyclical
Frictional
Structural
Seasonal
78
Banks are this kind of business entity
Sole Proprietorship
Corporation
Limited Partnership
Franchise
79
Which is not a source of revenue for local governments?
Intergovernmental Revenues/Transfers
Property Taxes
Corporate Income Taxes
Sales Taxes
80
Destroying old bills/coins and circulating new bills/coins is which responsibility?
Consumer Protection
Maintaining Payments System
Regulating Banks
Maintaining Currency
81
This occurs when an economy is not growing and there is high inflation, like during the 1970s
Hyperinflation
Stagflation
Creeping Inflation
Deflation
82
There's an inverse relationship btwn unemployment & Real GDP; as one goes up, one goes down
True
False
83
Prices rise due to consumers' excessive demands, leading to shortages which drive up prices
Excessive Monetary Growth
Cost-Push
Wage-Price Spiral
Demand-Pull
84
The interest rate that the Fed charges on loans to its member banks
Prime Rate
Member Bank Reserve
Discount Rate
Reserve Requirement
85
To calculate inflation rate, subtract the new index # by the old # and divide by the
New #
Old #
86
Economists created this tool to examine changes in the level of prices over time
Nominal GDP
Deflation
Market Basket
Consumer Price Index
87
Inflation hurts this group of people the most b/c they have no way to increase their incomes
College Students on financial aid
Military Service men & women
Retirees
Young parents of newborns
88
Which is NOT a local government expenditure?
Parks & Libraries
Fire
Police
Sam Rayburn Tollway
89
The Fed uses this tool MOST OFTEN to alter money supply
Discount Rate
Reserve Requirement
Open Market Operations
Prime Rate
90
A program that provides benefits if changes to the economy threaten an individual's income
Multiplier Effect
Supply-Side Policy
Accelerator Effect
Automatic Stabilizer
91
This is a moneyless economy that relies on the "mutual coincidence of wants" to trade
Fiat Money
Specie
Commodity Money
Barter
92
The Fed acts as the federal government's bank
False
True
93
The amount of new money the banking system generates with each dollar of deposits is due to
Member Bank Reserves
Excess Reserves
Money Multipiers
Legal Reserves
94
When you deposit funds into a Savings Account, money is functioning as a
Unit of Currency
Medium of Exchange
Measure of Value
Store of Value
95
Local governments collect this kind of tax, roughly 1.5-3% of the value of real property
Property Tax
Inheritance Tax
Capital Gains Tax
Sales Tax
96
Which of the following is NOT an Automatic Stabilizer?
Progressive Income Tax
Entitlement Programs
FICA Taxes
Unemployment Insurance
97
Banks make a majority of their profit from which of the following?
Fed Deposits
Savings Account Interest
Loans
Overdraft Fees
98
The nearest Federal Reserve District Bank is located in
Atlanta
Dallas
Houston
Oklahoma City
99
Which are the two components of FICA taxes?
Medicare and Social Security
Medicare and Medicaid
Medicaid and Social Security
Social Security and 401K
100
These kinds of policies favor targeting businesses to stimulate the economy and provide jobs
Supply-Side Policies
Demand-Side Policies
101
Gold or Silver Coins
Commodity Money
Fiat Money
Bonds
Specie
102
When comparing prices of an item across different stores you are using money to evaluate
Measure of Value
Medium of Exchange
Store of Value
Portability
103
the ratio of unemployed persons divided by the civilian labor force, times 100
Nominal GDP
Inflation Rate
Unemployment Rate
Real GDP
104
To calculate REAL GDP, economists use a set of constant prices from a base year
False
True
105
How large is our deficit each year?/How much is the federal government OVERSPENDING each year?
20%
50%
10%
5%
106
All people aged 16+ who are employed or who are actively seeking employment
Bureau of Labor Statistics
Unemployment Rate
Civilian Labor Force
US Census
107
The dollar value of all final goods, services & structures produced in a country in a year
Unemployment Rate
Prime Rate
GDP
Inflation Rate
108
Currency does NOT include
Paper Money
Coins
109
Which is NOT a component of money?
Metallic Coins
Demand Deposit Accounts
Credit Cards
Federal Reserve Notes
110
When the general level of prices rise
Nominal GDP
Inflation
Unemployment
Real GDP
111
This is a period during which Real GDP declines for at least 6 consecutive months
Recession
Trough
Peak
Expansion
112
The federal government's attempt to influence the economy through taxing & government spending
Public Policy
Fiscal Policy
Capital Gains Policy
Monetary Policy
113
This graph describes which economic theory?
Output-Expenditure Model
Production Possibilities Curve
Demand Curve
Laffer Curve
114
unemployment caused by a fundamental change in the economy or workers not having skills
Frictional
Seasonal
Structural
Cyclical
115
This famous economist created Demand-Side policies in the 1930s
Ben Bernanke
John Maynard Keynes
Alan Greenspan
Adam Smith
116
Which of the following is NOT an impact of taxes?
Redistributes Income
Alters productivity and growth
Lowers prices for goods and services
Adjusts consumer behavior
117
These economic activities aren't reported to the IRS for legal or tax collection purposes
Intermediate Goods
Underground Economy
Secondhand Sales
Nonmarket Transactions
118
If an item is used as an input for a final good it is EXCLUDED from GDP
False
True
119
Money is lightweight, convenient and easy to transfer
Durability
Scarcity
Divisibility
Portability
120
Which is NOT a measurement used to assess the economic wellbeing of a country?
Interest Rate
Inflation Rate
GDP
Unemployment Rate
121
Current-year prices are used to calculate which of the following
Nominal GDP
Unemployment
Real GDP
Inflation
122
The federal government collects the most amount of money from
Corporate Income Taxes
Individual Income Taxes
Social Security Taxes
Federal Reserve System Earnings
123
This kind of tax imposes the same percentage rate of taxation on everyone, regardless of income
Equitable Tax
Proportional Tax
Progressive Tax
Regressive Tax
124
Money created by government decree that has no alternative value or use as a commodity
Bond
Specie
Fiat Money
Commodity Money
125
People available to work who have made an effort to find a job during the previous month
Employed
Unemployed
Civilian Labor Force
Incarcerated
126
In 2017, $100 buys you 30 groceries; in 2018, $100 buys you 24 groceries. This describes
Market speculation
Reduced purchasing power
Distorted spending patterns
Distorted distribution of income
127
unemployment caused by workers changing jobs on their own; temporary
Structural
Frictional
Cyclical
Seasonal
128
Relaxing or removing government rules that restrict business activities
Deregulation
Keynesian Economics
Laffer Curve
Reducing federal agencies
129
This tool to alter monetary policy involves the Fed changing interest rates on loans to banks
Open Market Operations
Discount Rate
Prime Rate
Reserve Requirement
130
When inflation rate changes grow between 1 to 3 percent per year, we refer to it as
Creeping Inflation
Stagflation
Hyperinflation
Deflation
131
The idea that those who benefit from services should pay in proportion to the benefits received
Ability to Pay Principle
Equity Principle
Efficient Principle
Benefit Principle
132
1/RR
Excess Reserve
Money Multiplier
Legal Reserve
Reserve Requirement
133
DDA is another name for
Securities
Certificates of Deposit
Checking Accounts
Savings Accounts
134
A Demand Deposit Account describes a
Government Security
Checking Account
Savings Account
Bonds
135
What is the purpose of the FDIC?
Ensure banks charge a fair interest rate
Ensure customers don't lose money if a bank fails
Ensure banks don't engage in risky investments
Ensure the bank has enough reserves to cover their loans
136
When the money supply grows faster than Real GDP; most common cause of Inflation
Demand-Pull
Wage-Price Spiral
Excessive Monetary Growth
Cost-Push
137
Sales taxes are this kind of tax
Regressive Tax
Progressive Tax
Capital Gains Tax
Proportional Tax
138
Monetary Policy can be described as
changes to the money supply
changes to the interest rate
changes to the reserve requirement
changes to the discount rate
139
This is a period of recovery that involves increased Real GDP & employment for several years
Expansion
Peak
Contraction
Trough
140
If the RR is 12%, what is the Money Multiplier?
24.32
8.33
7.25
14.78
141
Keynes was vehemently opposed to the government having deficits
False
True
142
This tool to alter monetary policy changes the percent of deposits that banks must keep
Discount Rate
Reserve Requirement
Open Market Operations
Prime Rate
143
The amount of a deposit that the bank retains and puts into their vault
Excess Reserve
Interest Rate
Legal Reserve
Reserve Requirement
144
This group of 12 individuals is directly responsible for monetary policy decisions
Federal Advisory Council
Federal Reserve District Bank Presidents
Federal Open Markets Committee
Board of Governors
145
Which is NOT a component of the business cycle?
Expansion
Trough
Recession
Depression
146
Activities that you perform for your own household that, while valuable, aren't included in GDP
Nonmarket Transactions
Secondhand Sales
Underground Economy
Intermediate Goods
147
There have never been any attempts to curb deficit spending and lower the national debt
True
False
148
Electronic transfer of funds, online banking, and processing checks are which responsibility?
Maintaining Currency
Financial Literacy
Maintaining Payment Systems
Acting as the Government's bank

QCA 2 Review Flashcards | StudBud

QCA 2 Review

148 termsStudBud Administration207 plays

This Quiz is designed to review all the material that McKinney Boyd Economics classes learn in the 2nd semester.

Flashcards148 cardsFPractice quizPHost liveL

Questions 148

Answers

1
This is a representative selection of commonly purchased goods and services by an urban family
Bread Basket
Market Basket
Consumer Price Index
Nominal GDP
2
When a change in investment spending influences consumer spending, reducing total spending
Accelerator Effect
Exponential Effect
Magnified Effect
Multiplier Effect
3
Coins count toward M1
True
False
4
By holding prices constant, it helps us rule out inflation as a cause for increased GDP
True
False
5
This branch of economics looks at the economy as a whole, from a big-picture perspective
Microeconomics
Macroeconomics
Classical Economics
Keynesian Economics
6
Corporate Income Taxes get paid to the
State government
County government
Federal government
Local government
7
This kind of tax is charged to individuals who earn a profit from selling real property
Capital Gains Tax
Proportional Tax
Regressive Tax
Progressive Tax
8
The Civilian Labor excludes
Incarcerated Individuals
Members of the military
Mental Health facility patients
All of the Above
9
The Fed was created in
1913
1943
1887
1933
10
Technological Unemployment occurs when workers are replaced by machines or automated systems
Structural
Frictional
Seasonal
Cyclical
11
Which is NOT a Supply-Side Policy?
Deregulation
Decreased Economic Role for Government
Lower Federal Taxes on Individuals & Businesses
Entitlement Programs
12
Banks pay customers interest on this kind of account
Money Market Account
Certificates of Deposit
All of the Above
Savings Account
13
The purchase of all goods and services are taxed, benefitting state governments
Inheritance Tax
Property Tax
Sales Tax
Capital Gains Tax
14
If Nominal GDP increases by 20% and inflation increases by 5%, Real GDP grows by
15%
20%
5%
10%
15
The sum of all outstanding obligations by the United States
National Debt
Balanced Budget
US Savings Bond
National Deficit
16
The Fed rarely uses this tool to alter the money supply
Prime Rate
Discount Rate
Reserve Requirement
Open Market Operations
17
This group of 7 individuals oversee the Fed
Board of Governors
Advisory Committee
Regional Banks
Federal Open Markets Committee
18
This kind of tax imposes a higher tax burden on lower income individuals
Progressive Tax
Regressive Tax
Proportional Tax
Capital Gains Tax
19
Deposit=$12,000. RR=8%. How much are Excess Reserves?
$150,000
$11,040
$960
$1,500
20
Keynes determined this variable in the Output-Expenditure Model caused the global depression
G
I
C
(X-M)
21
When banks lend out money, the economy's money supply shrinks
False
True
22
Which of the following is NOT a criteria for effective taxation?
Efficient
Biased
Equitable
Simple
23
Rising input costs drive up production costs, which increases the prices of products
Demand-Pull
Wage-Price Spiral
Cost-Push
Excessive Monetary Growth
24
Which of the following is NOT a way that state governments collect money?
Sales Taxes
Intergovernmental Revenues/Transfers
Property Taxes
Individual Income Taxes
25
Economists compare prices of goods and services in only the Northeast region of the country
False
True
26
Keynes advocated for this Sector to act as a counter-balance to the Investment Sector
Net Foreign Sector
Import Sector
Consumer Sector
Government Sector
27
The amount of a deposit that the bank loans out to other customers
Excess Reserve
Discount Rate
Interest Rate
Legal Reserve
28
Which would NOT a cause a new business cycle?
Fed employs a tight money policy
Investment sector spending slows
Stock market hits a record high
Terrorist attack in the US
29
Gunpowder, Corn, and Musket Balls are examples of this kind of money
Fiat Money
Specie
Commodity Money
Barter
30
Each time a bank lends money to a customer, the money supply gets larger
True
False
31
A policy where the Fed expands the money supply, interest rates fall, and spurs the economy
Easy Money
Fixed Money
Specie
Tight Money
32
A security where BIG money is loaned for a set period of time for a set amount of interest
Certificates of Deposit
Stocks
Mutual Funds
Bonds
33
When the Fed buys bonds, it increases the money supply
True
False
34
When government expenditures are greater than revenue collections in a single budget year
Budget Deficit
Budget Surplus
Borrowing Rate
National Debt
35
GDP stands for
Gross Demand Percent
Goods Directly Produced
Goods Demanded Periodically
Gross Domestic Product
36
An alternative tax plan where Warren Buffet would pay the same tax rate as his secretary
Value-Added Tax
Progressive Tax
Regressive Tax
Flat/Fair Tax
37
Regular ups and downs of Real GDP describes
business fluctuations
unemployment
inflation
business cycle
38
The absolute lowest interest rate that a bank will charge its BEST customers (w/ good credit)
Reserve Requirement
Discount Rate
Excess Rate
Prime Rate
39
Our basic unit of currency in the US
Certificate of Deposit
Federal Reserve Note
Penny
Gold Standard
40
There is a lag time (delay) for economists to know how the economy is actually performing
False
True
41
Inflation hurts banks b/c loans are repaid later with dollars that buy less
True
False
42
A "good" unemployment rate is between
1 & 3 percent
4 & 6 percent
3 & 8 percent
2 & 5 percent
43
Workers demand higher wages due to increased prices; which in turn leads to more higher prices
Demand-Pull
Wage-Price Spiral
Excessive Monetary Growth
Cost-Push
44
This tool to alter monetary policy involves the Fed purchasing government securities
Discount Rate
Open Market Operations
Reserve Requirement
Prime Rate
45
M2 includes
Money Market and Mutual Fund Accounts
Savings Account Deposits
All of the Above
All of M1
46
Deposit=$10,000. RR=15% . How much are legal reserves?
$150
$667
$8,500
$1500
47
The ability of money to be accessed quickly and efficiently whenever the depositor requires
Reserve Requirement
Certificate of Deposit
Money Market Account
Liquid
48
Raising the discount rate causes more banks to want to borrow money, and spurs the economy
False
True
49
Money is in limited supply
Scarcity
Portability
Duruability
Divisibility
50
A consequence of inflation is that people change their spending habits. This describes
Distorted distribution of income
Distorted spending patterns
Reduced purchasing power
Market Speculation
51
When the Fed buys government securities, it decreases the circulation of bonds
False
True
52
The ability of money to withstand constant exchange without becoming mutilated and worn
Scarcity
Spendibility
Portability
Durability
53
Goods that are components of other final goods and aren't included in the GDP
Nonmarket Transactions
Secondhand Sales
Intermediate Products
Underground Economy
54
unemployment caused by annual changes in the weather or other conditions
Seasonal
Cyclical
Frictional
Structural
55
Which is NOT liquid money?
Currency
Demand Deposits
Traveler's Checks
Small-Time Deposits
56
Which of the following was NOT a Chairman of the Federal Reserve?
Alan Greenspan
Ben Bernanke
John Maynard Keynes
Janet Yellen
57
Deposit= $720. RR= 24%. What is the Excess Reserve?
172.8
30
8.33
547.2
58
GDP= C + I + G + (X-M)
Unemployment Rate
Inflation Rate
Output-Expenditure Model
Expenditure Stabilizer Theory
59
The amount or fee that is charged to a borrower of a loan
Interest Rate
Excess Reserve
Legal Reserve
Discount Rate
60
This kind of tax imposes a higher percentage tax rate on higher income individuals
Regressive Tax
Progressive Tax
Proportional Tax
Inheritance Tax
61
When measuring the money supply, the Fed considers
M1
All of the Above
M2
M3
62
No new production occurs when products already exist, so these aren't included in GDP
Nonmarket Transactions
Secondhand Sales
Intermediate Goods
Underground Economy
63
What does a fractional reserve system mean?
Banks use cash and debit transactions
Banks report daily to the Federal Reserve
Banks keep a small portion of deposits & loan the rest
Banks use fiat money as well as coins
64
Which of the following is NOT a major limitation of demand-side policies?
Increased government spending
Lag Times
Dependency on the government
Deregulation
65
When a change in investment spending reduces total spending, causing investors to invest less
Magnified Effect
Multiplier Effect
Accelerator Effect
Exponential Effect
66
A policy where the Fed decreases the money supply, interest rates go up and discouraging loans
Easy Money
Tight Money
Fixed Money
Commodity Money
67
The Fed is owned by
Member Banks
The Public
Congress
The President
68
The ability of money to be accepted by all parties in a transaction
Portability
Store of Value
Medium of Exchange
Measure of Value
69
This tax is charged to individuals who receive money or real property from dead relatives
Inheritance Tax
Proportional Tax
Sales Tax
Capital Gains Tax
70
Economists use a scientific sampling technique to estimate a country's GDP
False
True
71
The Federal Reserve is affiliated with the Republican Party.
False
True
72
The ability to break a currency down into smaller portions
Durability
Divisibility
Portability
Spendibility
73
The belief that people should be taxed on their ability to pay, regardless of benefits received
Ability to Pay Principle
Efficiency Principle
Equity Principle
Benefit Principle
74
The amount of a deposit to be set aside in legal reserves is determined by
Fractional Reserve
Money Multiplier
Reserve Requirement
Member Bank Reserves
75
The federal government's largest expenditure is
Social Security
Education
Medicare
National Defense
76
Who is responsible for Monetary Policy?
The Supreme Court
The President
Congress
The Federal Reserve
77
unemployment directly related to swings in the business cycle and the result of recessions
Cyclical
Frictional
Structural
Seasonal
78
Banks are this kind of business entity
Sole Proprietorship
Corporation
Limited Partnership
Franchise
79
Which is not a source of revenue for local governments?
Intergovernmental Revenues/Transfers
Property Taxes
Corporate Income Taxes
Sales Taxes
80
Destroying old bills/coins and circulating new bills/coins is which responsibility?
Consumer Protection
Maintaining Payments System
Regulating Banks
Maintaining Currency
81
This occurs when an economy is not growing and there is high inflation, like during the 1970s
Hyperinflation
Stagflation
Creeping Inflation
Deflation
82
There's an inverse relationship btwn unemployment & Real GDP; as one goes up, one goes down
True
False
83
Prices rise due to consumers' excessive demands, leading to shortages which drive up prices
Excessive Monetary Growth
Cost-Push
Wage-Price Spiral
Demand-Pull
84
The interest rate that the Fed charges on loans to its member banks
Prime Rate
Member Bank Reserve
Discount Rate
Reserve Requirement
85
To calculate inflation rate, subtract the new index # by the old # and divide by the
New #
Old #
86
Economists created this tool to examine changes in the level of prices over time
Nominal GDP
Deflation
Market Basket
Consumer Price Index
87
Inflation hurts this group of people the most b/c they have no way to increase their incomes
College Students on financial aid
Military Service men & women
Retirees
Young parents of newborns
88
Which is NOT a local government expenditure?
Parks & Libraries
Fire
Police
Sam Rayburn Tollway
89
The Fed uses this tool MOST OFTEN to alter money supply
Discount Rate
Reserve Requirement
Open Market Operations
Prime Rate
90
A program that provides benefits if changes to the economy threaten an individual's income
Multiplier Effect
Supply-Side Policy
Accelerator Effect
Automatic Stabilizer
91
This is a moneyless economy that relies on the "mutual coincidence of wants" to trade
Fiat Money
Specie
Commodity Money
Barter
92
The Fed acts as the federal government's bank
False
True
93
The amount of new money the banking system generates with each dollar of deposits is due to
Member Bank Reserves
Excess Reserves
Money Multipiers
Legal Reserves
94
When you deposit funds into a Savings Account, money is functioning as a
Unit of Currency
Medium of Exchange
Measure of Value
Store of Value
95
Local governments collect this kind of tax, roughly 1.5-3% of the value of real property
Property Tax
Inheritance Tax
Capital Gains Tax
Sales Tax
96
Which of the following is NOT an Automatic Stabilizer?
Progressive Income Tax
Entitlement Programs
FICA Taxes
Unemployment Insurance
97
Banks make a majority of their profit from which of the following?
Fed Deposits
Savings Account Interest
Loans
Overdraft Fees
98
The nearest Federal Reserve District Bank is located in
Atlanta
Dallas
Houston
Oklahoma City
99
Which are the two components of FICA taxes?
Medicare and Social Security
Medicare and Medicaid
Medicaid and Social Security
Social Security and 401K
100
These kinds of policies favor targeting businesses to stimulate the economy and provide jobs
Supply-Side Policies
Demand-Side Policies
101
Gold or Silver Coins
Commodity Money
Fiat Money
Bonds
Specie
102
When comparing prices of an item across different stores you are using money to evaluate
Measure of Value
Medium of Exchange
Store of Value
Portability
103
the ratio of unemployed persons divided by the civilian labor force, times 100
Nominal GDP
Inflation Rate
Unemployment Rate
Real GDP
104
To calculate REAL GDP, economists use a set of constant prices from a base year
False
True
105
How large is our deficit each year?/How much is the federal government OVERSPENDING each year?
20%
50%
10%
5%
106
All people aged 16+ who are employed or who are actively seeking employment
Bureau of Labor Statistics
Unemployment Rate
Civilian Labor Force
US Census
107
The dollar value of all final goods, services & structures produced in a country in a year
Unemployment Rate
Prime Rate
GDP
Inflation Rate
108
Currency does NOT include
Paper Money
Coins
109
Which is NOT a component of money?
Metallic Coins
Demand Deposit Accounts
Credit Cards
Federal Reserve Notes
110
When the general level of prices rise
Nominal GDP
Inflation
Unemployment
Real GDP
111
This is a period during which Real GDP declines for at least 6 consecutive months
Recession
Trough
Peak
Expansion
112
The federal government's attempt to influence the economy through taxing & government spending
Public Policy
Fiscal Policy
Capital Gains Policy
Monetary Policy
113
This graph describes which economic theory?
Output-Expenditure Model
Production Possibilities Curve
Demand Curve
Laffer Curve
114
unemployment caused by a fundamental change in the economy or workers not having skills
Frictional
Seasonal
Structural
Cyclical
115
This famous economist created Demand-Side policies in the 1930s
Ben Bernanke
John Maynard Keynes
Alan Greenspan
Adam Smith
116
Which of the following is NOT an impact of taxes?
Redistributes Income
Alters productivity and growth
Lowers prices for goods and services
Adjusts consumer behavior
117
These economic activities aren't reported to the IRS for legal or tax collection purposes
Intermediate Goods
Underground Economy
Secondhand Sales
Nonmarket Transactions
118
If an item is used as an input for a final good it is EXCLUDED from GDP
False
True
119
Money is lightweight, convenient and easy to transfer
Durability
Scarcity
Divisibility
Portability
120
Which is NOT a measurement used to assess the economic wellbeing of a country?
Interest Rate
Inflation Rate
GDP
Unemployment Rate
121
Current-year prices are used to calculate which of the following
Nominal GDP
Unemployment
Real GDP
Inflation
122
The federal government collects the most amount of money from
Corporate Income Taxes
Individual Income Taxes
Social Security Taxes
Federal Reserve System Earnings
123
This kind of tax imposes the same percentage rate of taxation on everyone, regardless of income
Equitable Tax
Proportional Tax
Progressive Tax
Regressive Tax
124
Money created by government decree that has no alternative value or use as a commodity
Bond
Specie
Fiat Money
Commodity Money
125
People available to work who have made an effort to find a job during the previous month
Employed
Unemployed
Civilian Labor Force
Incarcerated
126
In 2017, $100 buys you 30 groceries; in 2018, $100 buys you 24 groceries. This describes
Market speculation
Reduced purchasing power
Distorted spending patterns
Distorted distribution of income
127
unemployment caused by workers changing jobs on their own; temporary
Structural
Frictional
Cyclical
Seasonal
128
Relaxing or removing government rules that restrict business activities
Deregulation
Keynesian Economics
Laffer Curve
Reducing federal agencies
129
This tool to alter monetary policy involves the Fed changing interest rates on loans to banks
Open Market Operations
Discount Rate
Prime Rate
Reserve Requirement
130
When inflation rate changes grow between 1 to 3 percent per year, we refer to it as
Creeping Inflation
Stagflation
Hyperinflation
Deflation
131
The idea that those who benefit from services should pay in proportion to the benefits received
Ability to Pay Principle
Equity Principle
Efficient Principle
Benefit Principle
132
1/RR
Excess Reserve
Money Multiplier
Legal Reserve
Reserve Requirement
133
DDA is another name for
Securities
Certificates of Deposit
Checking Accounts
Savings Accounts
134
A Demand Deposit Account describes a
Government Security
Checking Account
Savings Account
Bonds
135
What is the purpose of the FDIC?
Ensure banks charge a fair interest rate
Ensure customers don't lose money if a bank fails
Ensure banks don't engage in risky investments
Ensure the bank has enough reserves to cover their loans
136
When the money supply grows faster than Real GDP; most common cause of Inflation
Demand-Pull
Wage-Price Spiral
Excessive Monetary Growth
Cost-Push
137
Sales taxes are this kind of tax
Regressive Tax
Progressive Tax
Capital Gains Tax
Proportional Tax
138
Monetary Policy can be described as
changes to the money supply
changes to the interest rate
changes to the reserve requirement
changes to the discount rate
139
This is a period of recovery that involves increased Real GDP & employment for several years
Expansion
Peak
Contraction
Trough
140
If the RR is 12%, what is the Money Multiplier?
24.32
8.33
7.25
14.78
141
Keynes was vehemently opposed to the government having deficits
False
True
142
This tool to alter monetary policy changes the percent of deposits that banks must keep
Discount Rate
Reserve Requirement
Open Market Operations
Prime Rate
143
The amount of a deposit that the bank retains and puts into their vault
Excess Reserve
Interest Rate
Legal Reserve
Reserve Requirement
144
This group of 12 individuals is directly responsible for monetary policy decisions
Federal Advisory Council
Federal Reserve District Bank Presidents
Federal Open Markets Committee
Board of Governors
145
Which is NOT a component of the business cycle?
Expansion
Trough
Recession
Depression
146
Activities that you perform for your own household that, while valuable, aren't included in GDP
Nonmarket Transactions
Secondhand Sales
Underground Economy
Intermediate Goods
147
There have never been any attempts to curb deficit spending and lower the national debt
True
False
148
Electronic transfer of funds, online banking, and processing checks are which responsibility?
Maintaining Currency
Financial Literacy
Maintaining Payment Systems
Acting as the Government's bank