stud
bud
Sign up
Log in
Home
Library
Explore
SAT
More
Economics for Political science / EFPS / IRO (exam prep) Flashcards | StudBud
Explore
/
Economics for Political science / EFPS / IRO (exam prep)
Economics for Political science / EFPS / IRO (exam prep)
176 terms
·
StudBud Administration
·
44 plays
Imported from external platform
Flashcards
176 cards
F
Practice quiz
P
Host live
L
Questions
176
Answers
1
What is the dominant strategy for Bala in this payoff matrix?
N d'or
Rice
Human trafficking
Cassava
2
Governments also borrow, what would not happen if they don't?
Cut spending during an economic downturn
Have to raise taxes
Increase public enforcement
Sell assets to raise revenue (which might hurt productivity)
3
What are public policy tools?
Government make-up, command, redistribution
command, culture, politics
Tax & allocation, interests, persuasion
Command (control regulation) Information (persuasion) tax (redistribution)
4
Can a bargaining situation where workers have more bargaining power lead to inflation?
False
True
5
What is GDP Growth used for in economics? To analyze...
Across markets (dev of market) and across systems (effectiveness of system)
across time(GDP growth) and in countries (local effectiveness)
Across countries (size of economy) and across markets (dev. of market)
Across countries (GDP growth) and across countries (level of development)
6
What is the single consumer surplus in this graph?
$30
$45
$15
$60
7
What does a point on this indifference curve mean and what point is the optimal choice?
A measure of endowment / E
A visual representation of the price of money / G
A measure of impatience / E
A measure of behavior / F
8
What is an investment bank?
A not-for-profit bank established to ensure bank services for all
Investment into the land alongside or sloping down to a river or lake
A financial establishment that uses money deposited for investment
A firm that buys & sells financial assets, both for clients & own business
9
basically capitalism is
An economic system that is focuses on material wealth at all costs
An economic system that only favors the rich and wealthy
An economic system based on individualism and economic incentives
An economic system with inherent tensions that will lead to REVOLUTION
10
What is not a mechanism to lower inflation from Central banks?
Discount windows
Interest rates
Swaps & emergency liquidity assistance
Pawnshop trading
11
What is an incentive used by companies to motivate working?
Income that is above minimum wage/unemployment insurance + cost of job loss
contract that ensures bargaining power + income more than transaction cost
An income accompanied by bonuses for hard work
An income that is higher than the transaction cost
12
What does this graph tell us?
Shows how inputs translate to outputs
Shows how input doesn't change the output
Shows how more inputs always create higher outputs
Shows how inputs are mutually constant
13
What emergency loans can be given to government?
CB purchases assets outright for a discount
CB acts like a pawn shop to increase money supply: (offers swaps)
CB can purchase government bonds directly (at policy rate it sets)
14
How do lenders decide who to lend money to for unsecured credit? And what do borrowers get subjected to often?
Know Your Costumer / Credit constrained
Employment status / Credit limited
Credit rating agencies / Credit-excluded
Educational qualification / Credit agency
15
When do policy tools work?
With flexible goods
With elastic goods
With fixed goods
With stiff goods
16
What is not a type of unemployment?
Cyclical
Frictional
Structural
Institutional
17
Is capitalist expansion part of public policies purpose?
False
True
18
What is it called when the MRT = MRS?
that as you move to the right along indifference curve it becomes flatter
Technology maximizing (optimal outcome)
Utility-maximizing (optimal choice)
That higher indifference curves correspond to higher utility levels
19
What is the technical definition of GDP
A = B+C+D+(E-G)
Y = C+I+G+(X-M)
G = C+I+M+(Y-X)
Y = X+M+C+I+G
20
Why are crypto assets not money?
They are not a store of value
They are not worth anything
They are not a unit of action
They can not be a medium of exchange
21
What does EDITBA stand for?
Earnings before taxes, depreciation, inelastic expenses, interest
Environmental impact of Domestic Trade, social Benefit & consumption
Energy Dance In The Bible with Adam
Earnings before interest, taxes, depreciation & amortization
22
When interest rates go up ... (multiple answers)
imports become cheaper
Exports become cheaper
Asset prices go down
Households who own assets are wealthier
23
What is the slope in a production function tell us?
It's the % change of output for every unit of input (marginal product)
It's equal to the change in output for every unit of input (marginal prod.)
It's the change of in input per hour of studying (diminishing product)
The amount of input that you put in (Marginal product)
24
What is not a reason given for economic growth?
Population
Consumer/business sentiment
Rainfall (for farmers)
(Trade) war
25
What is this graph called? / and what does it mean when the line is steeper?
Isocost line / the more effort the employer gets for wage
Isocost line / the more income the worker gets for per unit of effort
Exocost line / the more effort the employer gets for wage
Exocost line / the more income the worker gets for per unit of effort
26
... is a political factor of change in unemployment when ...
Political election cycle / politicians stimulate economy prior to election
Political unemployment cycle / Unemployment decreases before election
Unemployment election cycle / Unemployment decreases before election
Political business cycle / politicians stimulate economy prior to election
27
What is not a part of Procedural /normative fairness?
Voluntary exchange of private property
Is wealth distributed meritoriously or equally
Equal opportunity for economic advantage / or subject of discrimination
Deservingness: Is help needed to have a fair chance at success
28
Bonds = ...
You loan money and get regular share of the profits annually
You buy a share and get regular fixed interest payments
You buy a share of the firms profits which you are entitled, paid quaterly
You loan money and get regular, fixed interests payments
29
Derivatives are contracts ...
Of which the value depends on the performance of underlying market
That ensure safe insurrance against price volatility
Blue + red
Red + ability to ask for money back at any time
30
What is the difference between nominal wage and real wage?
The real wage is the nominal wage adjusted for inflation
The nominal wage is your real wage + employment rent
The real wage is = your disposable income
The changes in price between different time periods
31
What is bargaining power?
the ability to find work elsewhere, social safety net
The extend of a persons influence on an institution through coercion
Extent of person’s advantage in securing larger share of the economic rents
The power given to exploiters over producers
32
What is the marginal rate of transformation?
It represents the trade-offs an individual is willing to make
Shows the maximum output that can be achieved with a given amount of input
Represents the Indifference for other options in %
Represents the tradeoffs an individual faces (opportunity costs)
33
The real interest rate = ...
Nominal interest rate - GDP growth rate
Nominal interest rate - inflation rate
Inflation rate + nominal interest rate
Inflation rate - GDP growth rate
34
The best response curve does not shift because of...
Level of employment
Cost of living
Change in reservation wage
Change in company strategy
35
What is nominal GDP?
Gross domestic product measured in current currency amount
Gross domestic product adjusted for inflation
Gross domestic product growth in percentages of an economy
Gross domestic product adjusted for differences in currencies
36
Why is Germany's wage-setting curve further to the right then Spain's?
The population of Germany is larger = higher number of employees
The real GDP of Germany is higher = more profits to be made
The GDP of Germany is higher = more profits to be made
The productivity is higher in Germany = lower structural unemployment
37
What is a risk with bonds for companies and governments?
Bondholders can demand money back at any time = liquidity issues for issuer
Investors can demand higher interest rate if bond = higher risk of default
Issuer at risk of losing ownership / control of organization to bondholders
Exogenous shocks can send companies or governments bankrupt => bond worth 0
38
The economic cost = monetary cost ...
+ Objective cost
+ Subjective cost
- Taxes
Societal cost
39
A group of companies that keep prices artificially high, and production low is called...
A Oligopoly
A monopoly
A capitalist market
A cartel
40
What is your disposable income?
Income after paying taxes
Income after paying all inelastic goods and elastic goods
Income after paying taxes and receiving transfers from the government
Income after paying all inelastic goods
41
What does "DWL" stand for?
Deadweight loss: gains of trade lost compared to competitive markets
everything above the demand curve
Deadweight loss: The difference between total surplus and marginal cost
Deadweight loss: gain of trade lost due to taxation and other payments
42
What matters???
INCENTIVES
Size
Being happy
Not economics
43
What is the money conversion rate to adjust for difference in currencies and what those currencies can buy?
Purchasing power parity (PPP)
Real Gross domestic product
Real Gross national product
Purchasing concentration rate
44
What is one of the three economic roles of central banks?
Control fiscal policy, including government spending and taxation
Act as the primary regulator of stock markets and commodity exchanges
Determine national tax rates to ensure economic stability
Manage finance for the state
45
How do firms exploit inelastic goods through the fact there are few alternatives?
They can change prices by controling supply and demand
They can create inflation to increase the worth of their capital goods
They can charge higher prices
They can create monopolies and take over the market
46
What is this curve called?
Lorenz curve
Philipps curve
Keynes' curve
THE curve
47
What solution did Elinor Ostrom come up with to solve the tragedy of the commons? Farmers can...
Create a legal system with judges and judicial law book to punish the cows
Create rules & transparency for commitments requires, good information
Create a system of checks and balances so no one steps out of line
Create equal responsibility for the common good and equal consequence
48
Money is ...
Medium of exchange, unit of value and determinant of economic stability
Medium of exchange, unit of action and store of value
Medium of corruption, unit of capitalism and store of staus-quo
national currency, unit of action and store of value
49
What can workers use to increase reservation indifference curve?
Lobby & vote
Increase their bargaining power
Put pressure on institutions
Organize mass civil-disobedience in favor of Citizens' Assemblies
50
What is not a toolkit to overcome social dilemmas?
Repeated interaction
Fewer number of players
War
Social norms and persuasion
51
Are voting population changes part of public policies purpose?
True
False
52
What is the Marginal revenue
How much money firms earn if they sell a certain quantity
Red answer - green answer
Green answer - red answer
How much money a firm spends to generate revenue
53
What is the relationship between the supply and the demand curve?
perpendicular
Pareto efficient
Parallel
Equilibrium
54
What are the core concepts of game theory
Social interactions, strategic interaction, and invisible hand
Social interaction, strategic interaction, and strategy
Strategic interaction, parreto efficency, and strategy
Strategy, nash equilibrium, and parreto efficieny
55
What makes it that central counterparties can be used as a safety mechanism?
Collect fees for all transactions & guarantee payment if payment fails
They can sell packages to investment banks, that reduce the risk of default
They are like that
Central counterparties have investment banks as members
56
What is the main problem of 'joint goods'?
Distribution of authority benefits
Distribution of goods between participants
Distribution of cooperation benefits
Distribution of environmental consequences
57
How is the price of money measured?
The total surplus of an entire country
The absolute nominal amount of money
Through interest rates
Through adjusting for inflation
58
What is not an example of banks fragility and financial stability?
Banks need to be able to borrow from other banks overnight (also central B)
Bank need to focuse only on short-term loans and avoid long-term investment
Banks need to have enough cash on hand to meet daily demand
Banks also might need to be closed (resolved)
59
When bargaining power of firms is much larger than consumers what happens?
Oligopoly
Normal inflation
Monopoly
Greedflation
60
Merchandise trade is commonly used as...
Measure for economic development
Measure of world exports
Measure of globalization
Measure for strength of economy
61
Joint goods are?
Private Goods enjoyed by all participants of an economy
Private goods enjoyed by actors only if they can cooperate
Goods that can only be enjoyed by flexible markets
The total amount of goods combined in an economy
62
Does GDP include things that are imported from other countries?
True
False
63
What is the main limitation for government policy to work?
Both monetary & fiscal policy need to work in same directiction
Policy needs to be centrally organized within the same institution
Taxes need to stay low for growth to occur
The central bank needs to keep interest rates low
64
What does the price-setting curve show?
Price that shows the real wage paid, given product prices
The changes in price between different time periods
The real wage that HR would like to pay for every level of employment
how wages for employers are set
65
Capital goods are...
Goods that are used to produce other goods but not a part of other goods
Goods that will not be sold again as part of another good
Goods that do not equate to liquid money
Goods that will be used to make something else that will be sold
66
Who wins during economic deflation
Anyone who has to pay debts
Anyone who has to earn money
Anyone who has money
Anyone who has an income coming from another country
67
What are non-excludable goods?
Goods that can be used by everyone
Goods that once supplied anyone can consume for free & have no rival goods
Goods that can't be used by anyone
Goods that have no rival goods and is publically available
68
Micro-economics (according to ppt) is the study of...
individual incentives and behavior
Incentives faced by individuals and firms that lead to aggregate outcomes
behavior that creates small exogenous shocks
Incentives that have an impact on local economics
69
Why do firms pay employment rents?
Profits, the more motivation for workers = more profits for the firm
Minimize transaction cost for firm, costs firm money when employees leave
Recruitment, Expanding the pool of job applicants the firm can choose from
Minimize employees complaints, dealing with complaints is a hastle icl
70
Common-pool resources (tragedy of the commons) are...
Resources shared by a group: unlimited amount of supply from government
Limited amount of resources shared by a group: sustainability -> restraint
Resources that everyone in society has access to
Limited amount of natural resources available to humans
71
What is not a reason governments borrow?
To make an investment today that will (hopefully) pay off in the future
To smooth out economic cycle (consumption)
To avoid liquidating assets to make current payments
To save money for a rainy day (Save to use during economic crisis)
72
Stocks = ...
You loan money and get regular share of the profits annually
You buy a share of the firms profits which you are entitled, paid quaterly
You buy a share and get regular fixed interest payments
You loan money and get regular, fixed interests payments
73
What does the green line in this graph mean?
The environmental frontier
Biological survival constraint
The production feasability frontier
The survival frontier
74
Which fiscal policy strategy: Demands management
Post-Keynesian
Monetarist
Keynesian
75
What is it called when central banks increase liquidity (cash in circulation) through extraordinary measures?
Emergency financing
Quantitative easing
Lower-than-zero easing
Qualitative easing
76
What does ceteris Paribus mean as a key idea of economic modeling?
See more by looking at less: focus on 1 variable, not thinking about others
See more by looking at less: hold other variables constant
Rewards or punishments that affect the costs and benefits of action
focus on ratios of things to help us compare different courses of action
77
Elastic goods are...
Goods that are indispensable
Goods that are dispensable
Goods that are flexible for producers
Goods that have constant prices
78
borrowing = ...
Allows to buy more now at the cost of less later
Allows to buy more now
The interest rate
Smooths out consumption when spending it immediatly
79
What do institutions not do
Institutions influence growth and influence the distribution of wealth
Institutions shape who has bargaining power within the economy
Institutions shape incentives and therefore behaviour
Institutions reinforce inequalities and reinforce position of the elite
80
Does this payoff matrix lead to a dominant strategy equilibrium?
No, because the dominant strategy of players is not = to the best response
Yes, because in all situations at least one player gets 3
No, because players don't care for each other so nothing changes
Yes, because the dominant strategy of players is = to the best response
81
What does utility mean?
Tells us which options are possible, impossible and efficient
The total satifaction received from consuming a good
The utility gain if actor chooses particular outcome/takes particular path
The downward slope on an indifference curve
82
What is not a psychological bias or game theory gaps?
Recency bias
Imperfect information & cognition
Discounting behavior
Social preferences
83
What does not influences bargaining power?
Outside options, ability to find work elsewhere
The rules of the game (institutions)
Coercion
The abilities and skills of an actor
84
What are transaction costs
Effort and opportunity cost of switching behaviour
Represents the tradeoffs an individual faces (opportunity costs)
It represents the trade-offs an individual is willing to make.
The utility gain if actor chooses particular outcome/takes particular path
85
What needs to rise equally with wage price to ensure zero inflation? (prevent wage-driven increases)
Total surplus
Real GDP
Price setting
Productivity
86
GDP measures...
The market value of all goods produced within a country
The market value of all capital goods produced within a country
The market value of all finished goods produced within a country
The market value of products/services produced by the citizens of a country
87
Procedural / normative fairness asks...
If the roles of the game treat folks (in)appropriately
If the economy will suceed or not
If current public policy rules are beneficial or not
If the game fosters or inhibits economic activity & rewards
88
What do stocks grant stockholders?
Stocks give holders voting rights in the company
Ownership of the company’s physical assets
The right to a fixed, guaranteed return on investment
The ability to demand repayment of their investment at any time
89
What game type have actors experience pressure to not cooperate, even though benefits are high?
Invisible hand
Coordination
Prisoner's Dilemma
Tragedy of the commons
90
What way of international investment allows investment to be enter / exit country quickly
FDI
Portfolio investment
91
Liquidity traps occur when ... and have ... dyanmic
There is no investment or consumption out of fear for future / Prisoner D.
There is a undersupply of cash flow in an economy / Prisoner D.
There is a undersupply of cash flow in an economy / Tragedy of C
There is no investment or consumption out of fear for future / Tragedy of C
92
What is the dominant strategy of the Pesticide game?
Bala use Terminator and Anil use IPC
Anil use terminator and Bala use IPC
Both use IPC
Both use terminator
93
Lending ... for a saver
Money without interest changes behavior of saver into consumer
Money with interest expands the saver's feasible set
Money with interest decreases the saver's feasible set
Money with interest changes behavior of saver into consumer
94
A central bank is ... (multiple correct answers)
The only bank able to give out loans to governments
The only bank able to change policy interest rate
The only supplier of base money (fiat money)
The only bank able to give out loans
95
Hecksher-Ohlin trade theory says...
Country will import = what makes high use of resources it has in abundance
Country will export = what makes high use of resources it has in abundance
Country will produce = what makes high use of resources it has in abundance
Country will specialize = what high use of resources it has in abundance
96
What is the joint surplus in this graph?
Everything under the feasible frontier
Difference between the biological survival constraint and reservation curve
Difference between the reservation curve and the feasible frontier
Difference between biological survival constraint and feasible frontier
97
What is policy reinforces a recession by further reducing aggregate demand called?
Downturn policy
Monetarist policy
Austerity policy
Freefall policy
98
What is does it mean if country has current account deficit?
Country is buying more from the rest of the world than it sells
Country is selling more to the rest of the world than buying
99
What game is often characterized as a "monopoly game" where you take it or leave it?
Tragedy of the common game
Ultimatum game
Repeated game
Dictator game
100
A contract between firm and employee is incomplete because...
Some task depend on future (unknown) events
The owner wants to keep the bargaining power within a firm centralized
Some tasks will be asked of the worker without it being in contract
Contracts are inherently badly set up
101
What does BATNA mean?
Best Agreement To a Negotiation Available
Best Alternative To a Negotiated Agreement
I Would Like To Meet Your Mother
Best Available Treaty for all Negotiators in the Agreement
102
What's not a reason to create economies of scale?
Labor force becomes cheaper
Fixed costs (research) become cheaper
Bargaining power for input, specialization & expertise, good competition
Demand advantages (network effects), value rises with number of users
103
What is not a mechanism for governments to combat excessive rents?
Restricting business practices that prevent market entry
Restricting exploitive business practices
Limiting companies bargaining power through laws
Limiting company size
104
Macro-economics (according to the ppt) is the study...
Behavior that creates large exogenous shocks
Incentives faced by individuals and firms that lead to aggregate outcomes
incentives that have an impact on global economies
concerned with the creation, consumption, and transfer of wealth
105
Demand-led effects of economic shock means that...
Increased demand leads to lower prices and less supply
Increased demand leads to higher prices and supply to regain equilibrium
Increased demand leads to increased supply and increased prices
Increased demand leads to increased supply and lower prices
106
What are public goods prone too?
Nash equilibrium issues
free riding
tragedy of the commons
pareto sub-optimal outcomes
107
What is strategy
Each actor can communicate with each other to create optimal outcome
Each actor is aware of how their behaviour affects everyone’s outcomes
Each actor’s behaviour affects everyone’s outcomes
Actions taken that consider the outcomes and likely behaviour of others
108
What does it mean when "Banks provide maturity transformation services"?
That individual can borrow money short term but bank lends long term
Banks convert short-term saving accounts into long-term investment for bank
Banks change the maturity dates of loans arbitrarily to suit cash flow need
Banks ensure that all loans and deposits have the same maturity periods
109
When do economies of scale change into diseconomies of scale?
When average cost per unit increases because of other increase of inputs
When inflation hits the economy
When average cost per unit increases because of disinterested from consumer
When average cost per unit increases because of over supply into the market
110
Economic rent is ...
When the benefit from an action exceeds the economic costs
When the benefit from an action is a net profit of money
When the subjective cost is higher than the monetary cost
When the monetary cost is higher than the subjective cost
111
What does the supply curve show?
The amount sellers are willing to supply at different prices
The total revenue a seller earns at different price points
The relationship between production costs and market demand
The quantity consumers are willing to purchase at different prices
112
What are institutions in EFPS?
Rules, norms & values that guide political, economic &/or social behavior
a devised structure of rules & norms that shape & constrain social behavior
a devised structure of rules & norms that constrain social behavior
formal constitution, labor laws, Schengen Agreement
113
What is a reservation indifference curve?
The difference in endowment between saver and borrower
Shows a particular trade-off between consumption now and later
The indifference of reserving spot at library & seeing someone took it
The points at which individual would be as well off as reservation position
114
What is the sunk cost fallacy?
When an actor doesn't think at the margins, not think about future utility
When an actor lets the past be and focuses on future utility of actions
When an actor just wants to get the exams over
When an actor only cares about their own outcome without considering others
115
What is not a fiscal stimulus to support aggregate demand during economic downturn
Temporarily increase tariffs = be able to implement effective fiscal policy
Increase in infrastructure investment
Increase government expenditure = increases AD
Cut taxes = private sector & house holds to consume
116
What is a lesson from the prisoner's dilemma?
Selfish behavior can lead to suboptimal outcomes
In a prisoner's dilemma everyone is incentivised to choose the most optimal
Prisoner's always care for each other (brotherly love)
Selfish behavior always leads to the best outcome for everyone
117
What monetary measure adjusts for inflation to measure changes over time?
Nominal purchasing power parity (PPP)
Real gross domestic product (GDP)
International Tariffs
International inflation monitor
118
What makes CB able to influence how much money is spent?
Interest rates
Increased government spendingz
Artificial inflation
Taxation
119
What is the best response in a prisoners' dilemma?
Go to bed (alone)
Break out of prison
Remain silent
Confess
120
What are owners in a firm in regards to profits?
Just like regular workers (get a given income specified in a contract )
The ones in charge, decide behavior of firm and strategy
Residual claimants, profits from firm belong to them, not managers/workers
Capitalist, all income of a firm will go to expansion of that firm
121
contracts are / do not...
Specify skills of worker
specify income
A legal document
specify rights and responsibilities
122
What fairness approach- in the context of games, efficiency and norms- think about the distribution of wealth?
Normative / substantive
Procedural / normative
Substantive / allocation
Substantive / procedural
123
Which fiscal policy strategy: Internal devalution / deflation: general lowering of all prices
Keynesian
Post-Keynesian
Monetarist
124
What is not a reason countries specialize?
Economies of agglomeration
Global supply chain
Comparative advantage
Economies of scale
125
Which fiscal policy strategy: suffers from problem where governments spending drives inflation instead of employment
Monetarist
Keynesian
Post-Keynesian
126
What are public offerings?
redistribution of new stocks with workers of a firm
Selling of new stocks on stock market
Rituals sacrificing employees in the hope of stock price to go up
Trading of existing stocks on stock market
127
What is this graph called?
Gini coefficient
The actual distribution curve
Equality differential curve
Lorenz Curve
128
The Phillips curve shows that ...
Moderate inflation is inevitable
(Moderate) Inflation is okay as long as employment goes with it
More employment leads to more inflation
Less employment leads to more inflation
129
... unemployment is caused by ...
Frictional / a lasting gap between jobs on offer and employment on offer
Structural / the fall in aggregate demand
Natural / the time it takes to match employers with the employees
Cyclical / the fall in aggregate demand
130
What is not a problem of the invisible hand
Really bad outcomes
Sub-optimal outcomes
Always leads to one player suffering
Negative externalities
131
What company law creates more flexibility, innovation and raising of capital?
Owner-oriented law
Stakeholder-oriented law
Joint-ownership law
State run company law
132
What is a Nash equilibrium? a set of strategies that...
Each player’s strategy is best response to the strategy of everyone else
For each player's strategy as the best outcome for themselves
Makes sure that everyone gains equally from all interactions
Creates opportunities for the "Nash" of society (the worst of in society)
133
What are transmission mechanisms?
Monetary policy strengthened by cooperation of population
Monetary policy strengthened and weakened by various parts of the economy
Monetary policies effect on all economic sectors
Monetary policy's effect on different parts of the economy
134
What game type assumes that actors maximize benefits without any real strategy?
Random games
Invisible hand
Coordination
Tragedy of the commons
135
What is one of the three economic roles of central banks?
Lender of last resort to banks, government & economy
oversee commercial bank lending decision to ensure good credit distribution
Control the level of employment in the economy by directly creating jobs
Set exchange rates
136
What is a social dilemma?
When every individual chooses his strategy based on other individuals strat
When individuals purposefully act in suboptimal ways
When individuals have to interact with eachother
When individuals take action that results in a socially suboptimal outcome
137
What are shocks and long-run economic changes that don't effect unemployment?
China shock
Technological change
Trade and relocation of manufacturing
Exogenous spill-over effects from global economy
138
What is the best response? Strategy that will...
Give player the highest payoff, given the strategies of the other player
Give player more outcome than all other players in every situation
Give player the choice to benefit themselves or another player
Yield the highest payoff for a player no matter what the other player does.
139
How can monetary policy achieve two goals in the context of unemployment and price stability?
lower interest rates to increase demand for labor & prevent price increase
By directly setting wages and prices for businesses and workers
Can keep interest rates low than required=minimize inflation if help employ
By increasing government spending on public programs
140
What are piece rate contracts?
Employment that pays the worker a fixed amount for each product made
Employment that pays the worker a fixed amount for every hour worked
Employment that pays the worker a fixed amount for every goal reached
Employment that pays the worker a fixed amount for everyday worked
141
Which fiscal policy strategy: Implements strategic investments in infrastructure and critical industry
Monetarist
Post-Keynesian
Keynesian
142
What is the net benefit of the next best alternative action called?
Tradeoff
Opportunity cost
Constraining cost
Relative economic cost
143
What is a dominant strategy? Strategy that will...
give a player the highest payoff given the strategies of the other players
yield the highest payoff for a player, no matter what the other player does
Give player more outcome than all other players in every situation
Give player the choice to benefit themselves or another player
144
What is not a outcome of capitalism ?
New technology
Entrepreneurial innovators
Increase in overall wealth
Specialization
145
Consumption is affected by house prices because...
It changes value of colateral
Lower interest rates = higher housing prices
Higher housing prices = more consumption of other goods
It influences overall likelyness of opening a mortage
146
What is pareto efficiency? When there is...
No alternative for where at least one person is better off
No alternative that equity for all actors
no alternative where at least 1 person would be better off and nobody worse
An alternative that creates equality for all actors
147
Under what conditions are monopoly rents the highest?
When supply is inelastic
When demand is elastic
When supply is elastic
When demand is inelastic
148
people buy ... Elastic goods when prices drop
Less
More
149
Economics (in the ppt) is the study of...
the production, distribution, and consumption of goods and services
money money money, very funny
How incentives drive behavior
Analyzing currencies in the world
150
What is a solution for the social dilemma of public goods?
Law and security institutions
Creation of a centralized distribution center of all goods
Exclusion of certain people from public goods
Public provision and payment (taxes)
151
How can you lower frictional unemployment?
Job fairs, temp agencies, increase in government funding, higher education
Information, job fairs, higher standard of education, ...
Apprenticeship programmes, information, temp agencies, job fairs, ...
Apprenticeship programmes, change in public policy, temp agencies, job fair
152
A firm has ...
Capacity to influence public policy
Businesses in other countries that where their HQ is situated
A legal personality
A centralized structure
153
A company can ensure itself against price volatility by ... (hedging)
Offsetting the cost of downturn by investing in other (wealthy) market
Set up deals to sell all assets in case of economic downturn
Offsetting the risk by counterbalancing in opposing market / investment
IDK no one understands this lol
154
What is a characteristic of liberal market economies?
Low unions voice
Long-term constracts
Greater unemployment insurance
High unions voice
155
Corporate investment depends on ... (multiple right answers)
Interest rate
Expected return on investment
inelasticity of firms market
Level of competition
156
What does Rawl's veil of ignorance say? You should...
Create image of the system as unequal made to exploit certain people
Recognize the systems flaws and try to change them as a part of that system
Evaluate the system as a impartial insider
Evaluate the system as an impartial outsider
157
What is the consequences of unchecked behavior in the tragedy of the commons?
Only the individual who over-exploited is worse of
Everyone else is worse of except the individual who over exploited
Everyone loses
Everyone gains
158
When economy is booming generally people buy...
No stocks or bonds
more consumer products (no stocks / bonds)
More stocks
More bonds
159
Measuring the wealth of a nations individual is...
GNP per m3
Purchasing power parity per capita
GDP per m2
GDP per capita
160
What is social interaction?
Each actor’s behaviour affects everyone’s outcomes
Each actor's outcome is influenced by their social status
Each actor's behavior changes the games properties
Each actor is aware of how their behaviour affects everyone’s outcomes
161
Natural unemployment =
Structural - frictional unemployment
Structural unemployment cost - overall economic surplus
Structural + frictional unemployment
Structural + cyclical unemployment
162
What is a way to solve the conflict of interest (principal / agent problem) between lender and borrower?
Negligence
Autonomy
Forgiveness
Equity
163
What is meant with "Banks bring together folks that have money and folks that need it"? (Financial intermediaries)
Banks are intermediaries in negotiations for loans between rich and poor
Banks the only place where savers and borrowers can go for more money
Bank receives interest payments from borrowers, pays (less) to savers
Banks have accounts for all people in society from rich to poor
164
What is not a characteristic of stock market?
New issues of stocks transform savings to investment
Stock prices are always determined by company current earning & performance
Stock markets are generally riskier than bonds
they are a measure of market confidence
165
What does it mean when the blue line is above the red line?
Line go up = more money
The higher above the red line the more market dominant a firm is
higher costs of production lose the firm money with each additional unit
The firm can earn more money
166
consumption function line is steeper in...
nowhere, line always stays the same
Wealthier households
middle class households
poorer households
167
How do you solve social dilemma's in economics, political science, or international relations?
Revolution
Bargaining
Striking
No solution
168
What is a fault of GDP?
It's outdated
The formula is incorrect
GDP doesn't accurately show the actual power of an economy
It doesn't measure the distribution of income within a country
169
What is not one of the things that could go wrong in balance sheets?
Variable rate mortgages
Enough non-performing loans
Weak KYC practices increase number of unsecured loans
Inflation decreases real price assets and increases real price liabilities
170
What is strategic interaction
Actions taken that consider the outcomes and likely behaviour of others.
Each actor is aware of how their behaviour affects everyone’s outcomes
Each actor's behavior changes the games properties
Each actor's behavior tries to predict other actor's behavior
171
How does government fiscal policy stabilize economic fluctuations? (multiple right answers)
Spending during downturns to improve household consumption & investment
Lowering government expenditure
Automatic stabilizers:
Lowering taxes
172
What does the difference between the average product of labour and the price-setting curve show?
The firms profit
The differnce between reality and peak efficiency
The economic rent
The total surplus
173
What are the three elements of Capitalism?
Private property, markets and firms
Capital, net-worth and income
Money, coins and diamonds
Poverty, inequality and extortion
174
What abilities do firms have that single businesses don't in relation to capitalism
Absolute authority over their workers
Specialization of tasks
Ability to influence public policy
Ability to sign contracts with workers
175
The main point of new trade theory is...
To compete (when no comparative advantage), firms buy up other firms
To compete (when no comparative advantage), firms expand market
To compete (when no comparative advantage), firms play on human emotions
To compete (when no comparative advantage), firms increase variety
176
What does the slope of this graph tell us?
The indifference slop
The feasible frontier
The marginal rate of transformation
The marginal rate of substitution
