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Econ review Flashcards | StudBud
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Econ review
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1
what is maturity in relation to time deposits?
interest goes down when money sits for a long period of time
money must be held for a fixed period of time to receive interest in full
money can only stay for a short period of time and interest will go up
money can be held however long and the interest remains the same
2
Productivity is the amount of output that can be produced without a given input
False
True
3
What 3 basic questions do all economies try to answer
what will be produced, how much will it cost, who will buy it
what will be produced, how will it be produced, how will it be distributed
How much will it cost, how much will we make, how much do we need
How many people will buy it, who will buy it, why will they buy it
4
Installment debt is the largest debt people often have
True
False
5
what is a credit check?
reviewing your financial history
checking how many credit cards you have
seeing your credibility to get a loan
checking how good or bad your credit is
6
what are certificates of deposits?
issued by bank to a person depositing money for a certain period of time
issued by bank when someone deposits money often
issued by bank when a certain amount is deposited
issued by bank when you go into debt and make a deposit
7
example of inelastic demand
small items like a pencil
durables, like a car
large items like a house
things that are always bought like gas
8
defined as property not owned by the government...
capitalism
private property
public property
business
9
what is a credit union?
institution that is all about your credit score
nonprofit institution where people can borrow money from pooled deposits
people that give each other good credit
places where credit cards are made, distributed, and bought by people
10
Want is a necessity, need is something you would like
False
True
11
Monetary vs Fiscal policies
fiscal:taxation and spending
Monetary: taxation and spending
Fiscal:central banking activities
Monetary: central banking activities
12
sole proprietorship vs partnership
partnership: one owner, unlimited liability
proprietor: 2+ owners, combine resources and share profits
proprietor: one owner, unlimited liability
partnership: 2+ owners, combine resources and share profits
13
what are mutual funds?
making money with other people and sharing it
pooling money with other investors to purchase stocks and other things
making money and giving it away to other people
buying and reselling goods with other people and splitting the profits
14
what are examples of capital in business
equipment, vehicles, real estates
machinery, patents, company cars
laptops, tablets, audio equipment
all of the above
15
How to compute Consumer price index
add all expenses together then divide by the number of expenses there were
only professionals can do this
divide $ of base year (t) by money of market basket in a year
divide $ of market basket in a year (t) by the $ same basket in base year
16
defined as a place where buyers and sellers can meet to exchange and transact goods...
company
store
market
a place of business
17
how do investors make money from US savings bonds?
sell them at higher price than the initial
sell them at same price as the intitial
they don’t sell them
sell them at lower price than the initial
18
3 factors of credit scoring
capacity, character, collateral
speed, money, character
collateral, capacity, money
race, capacity, collateral
19
what is a corporation
a business
they pay a fee to get a format and system made by a company+use their name
a legal entity that is separate and distinct from its owners
formal agreement by 2+ parties to operate business and share profits
20
what are the 4 factors of production?
labor, land, business, capital
Money, labor, capital, entrepreneurship
Land, labor, capital, and entrepreneurship
capital, land, supply. demand
21
What is a dividend?
distribution of cash/stock to a class of shareholders in a company
distribution of cash/stock to a market owner
dividing money between a class of shareholders in a company
taking money from a class of shareholders in a company
22
what is macroeconomics
decisions of countries and governments
measures exports
measures good produced within a countries borders
study of individuals and businesses decisions
23
what is a collateral?
collateral damage
something the borrower gives to the lender, like money
something the lender gives to the borrower, like money
something that a lender can take if the loan isn't paid by the borrower
24
what is a GDP
gross domestic product
total market value of goods made by a country's economy in x amount of time
total value of goods made by a countries residents in U.S. or abroad
gross demand product
25
simple vs compound interest
simple: calculated anually based on the amount you owe/deposit
simple:interest earned is added to the principal
compound: interest earned is added to the principal
compound: calculated anually based on the amount you owe/deposit
26
what is discretionary income?
portion of income that the IRS determines as taxable
income remaining after deduction of taxes that one can spend on whatever
income after deduction of taxes+other mandatory charges
income that people get from wages and salaries etc
27
what is personal income?
income after deduction of taxes+other mandatory charges
income that people get from wages and salaries etc
portion of income that the IRS determines as taxable
income remaining after deduction of taxes that one can spend on whatever
28
how does real income affect the state
as one’s income decreases they demand more
as one’s income grows they start to demand more
as one’s income decrease their demand decreases
as one’s income increases they demand less
29
benefits of a credit union
low cost, and low interest rates
meet new people, manages your money, no fees
low interest rates, environment friendly, no fees, transparency
transparency, no fees, low interest rates, free credit
30
what is the law of diminishing marginal utility?
the decrease use of a product within a given set of parameters
the decrease in use of a product within a specific period of time
increased satisfaction a customer gets from the use of a product
the decreased satisfaction a consumer receives from a good/service
31
what is an installment debt?
using installments to pay off your debt
using installments to buy something like a house building or land
loan where you pay the borrower in installments
When you cant pay someone back
32
what is a traditional economic system?
traditions, customs, and beliefs determine what and how goods are sold
system that blends elements of different economies
productions, investments, prices and incomes are determined by government
factors of production are regulated by private businesses
33
What are pension plans?
the employer must pay money to employee after retirement
employee must pay money to employer after retirement
employees don't receive money after retirement
employers receive money from employees after retirement
34
determinants of supply
feedback, increase in tax, high wage rate
technology, # and expectations of suppliers,
the environment, the type of people, the cost
the government, the people , the state
35
What is microeconomics?
scarcity
study of individual and business decisions
decisions of countries and governments
supply and demand
36
Define trade off
sacrificing one thing to get another
gaining on thing to gain another
supply and demand
losing one thing to lose another
37
What is the advantage of a controlled economy?
more chances to receive money
less chance of going into debt
low levels of inequality and unemployment
good production of materials and goods
38
what is a capitalistic economy system?
factors of production are regulated by private businesses
productions, investments, prices and incomes are determined by government
system that blends elements of different economies
traditions, customs, and beliefs determine what and how goods are sold
39
what is the biggest disadvantage of a sole proprietorship?
unlimited liability
no support
choosing your own income
no help running the company
40
What is the law of supply?
price of good increases, quantity of goods offered will increase
a price of a product goes up, the demand goes down
to give something to someone
supplies are what you need for the start of school
41
Opportunity cost is similar to....
hypothesis
supply and demand
trade off
scarcity
42
example of elastic demand
small items like a pencil
durables, like a car
large items like a house
easily used like gasoline
43
What is the law of demand?
you can watch tv shows on demand
to ask something of someone
price of good increases, quantity of goods offered will increase
a price of a product goes up, the demand goes down
44
What is the concept of interest when getting a loan
giving the lender collateral when you don't pay back the money
interest is something you are curious about
money originally agreed to pay back
cost of borrowing the principal, make you pay more the longer you have loan
45
Hypothesis in economics is...
a proposition made as a basis for reasoning
change in one variable causes another to change
making a claim based off of limited evidence
a question
46
what are the functions of FDIC
soundness, consumer protection, manages receiverships
insures deposits, examines/supervises financial institutions for safety
makes large and complex financial institutions resolvable
lowers rent, soundness, insures deposits
47
benefits of good credit rating
all of the above
best interest rates
lower charges on loans
lower charges on credit card balances
48
a bank that offers services to general public and companies...
investment
commercial
private
universal
49
what types of businesses accounts for greatest share in revenue in the united states?
partnership
corporations
s corporation
sole proprietorship
50
factors that will cause demand curve to shift
all of the above
expectations/size/composition of population
income, trends and taste
prices of related goods
51
what is the substitution effect?
an increase in sale when a product is cheaper
a decrease in sale when a product is a same price as the other
a decrease in sale when a product is cheaper
a decrease in sales when there is a cheaper alternative
52
what is inflation
the rate in decrease of money in x amount of time
the rate in decrease of prices in c amount of time
the rate of money made in c amount of time
the rate in increase of prices over x amount of time
53
difference between ROTH IRA And traditional IRA
traditional: pre/after - tax dollars, tax deferred after age 59.5
ROTH: pre/after - tax dollars, tax deferred after age 59.5
traditional: money grows tax free after age 59.5, after tax dollars
ROTH: money grows tax free after age 59.5, after tax dollars
54
how does the federal reserve affect money supply?
modifies requirements
makes money supply lower
makes money supply greater
it has no effect
55
shortage vs surplus
surplus: excess demand for the low quantity of product
shortage: excess demand for the low quantity of product
shortage: resource that exceeds amount that is actively utilized
surplus: resource that exceeds amount that is actively utilized
56
what is the result of rent controls?
helps the environment
creates spillover on the surrounding neighborhood
decreases affordability, fuels gentrification
increases affordability
57
Who was Adam Smith?
Spanish Philosopher and economist
Scottish philosopher and economist
American Philosopher and economist
German philosopher and economist
58
how do you read a production possibilities curve?
downward curve means lower price
downward curve scarcity
bow shape results from allocating resources based on comparative advantage
show’s combination of two goods economy is capable of producing
59
what is a command economic system?
factors of production are regulated by private businesses
system that blends elements of different economies
productions, investments, prices and incomes are determined by government
traditions, customs, and beliefs determine what and how goods are sold
60
what are other names for market economy?
free economy, more money economy
capitalist, free market economy
hands off gov. and free market economy
capitalist and communist
61
what is a debit card
money that is borrowed from companies to buy things like houses
money on a card
money that comes straight out of your checking account
card issued by private banks
62
inelastic vs elastic demand
inelastic: change in quantity demanded due to change in price is small
elastic: change in quantity demanded due to change in price is small
inelastic: change in quantity demanded due to change in price is large
elastic: change in quantity demanded due to change in price is large
63
which type of investment carries the greatest risk?
equities
real estate
bonds
mutual funds
64
Most countries have a mixed form of economy
False
True
65
what is a franchise?
formal agreement by 2+ parties to operate business and share profits
a legal entity that is separate and distinct from its owners
they pay a fee to get a format and system made by a company+use their name
mcdonald’s is a franchise
66
what is APR
amount paid yearly that is rapid
cost paid yearly to borrow money
annual percentage rate
amount paid rapidly
67
what is a mixed market economy system?
factors of production are regulated by private businesses
traditions, customs, and beliefs determine what and how goods are sold
productions, investments, prices and incomes are determined by government
system that blends elements of different economies
68
Define Economics
Studies of production, distribution, and consumption of goods and services
the study of agriculture and farming and how the government controls it
decisions of countries and governments that influences money
study of money in a country and how the government menages it
69
what is the cost of credit expressed in dollars and cents
Credit Amount
Worth
Tangible Cost
Money
70
The components of GDP are...
personal consumption, labor, net exports, government spending
personal consumption, business investment, government spending, net export
land, Supply, demand, net export, personal consumption
land, labor, capital, entrepreneurship
71
what kind of indicators would include orders for consumer goods?
durable goods, banking history
durable goods, GNP history
durable goods, credit history
durable goods, GDP history
72
what are bonds?
things that hold molecules together
a debt security, similar to IOU
is formed when you make a new friend
a group of people make and share money together
73
GNP vs GDP
GDP: produced outside country border
GDP: Both U.S and non-U.S. residents
GNP: produced within and outside the country
GNP: Only U.S. residents
74
An act in which someone does not pay is a service
True
False
75
how to graph a supply and demand curve
supply goes up, demand goes down
demand goes up, supply goes down
76
Capital Gains vs losses
capital loss: sell asset for less than adjusted basis
capital loss: sell asset for more than adjusted basis
capital gain: sell asset for more than adjusted basis
capital gain: sell asset for less than adjusted basis
77
Supply and demand is most important model to an economist
True
False
78
Scarcity is defined as limited resources
False
True
79
What is a durable good?
a good that can break
a good that is completely consumed in one use
a good that cannot break
a good that doesn't wear out quickly
80
what is marginal utility?
satisfaction a consumer receives from a good/service
dissatisfaction a customer gets from the use of a product
use of a product within a given set of parameters
use of a product within a specific period of time
81
What was said in Adam Smith's Book "The Wealth Of Nations"?
Greed will lead to the ruin of out nations and societies
individual need to fulfill self-interst leads to societal benefit
productivity leads to wealth
economy will always go up and down within a country
82
when do people look for substitutes for products they normally buy?
if the price availability or quality changes
if the price, availability or location stays the same
if the price, quality, availability stays the same
if the price, availability or location changes
83
what is taxable income?
income remaining after deduction of taxes that one can spend on whatever
portion of income that the IRS determines as taxable
income that people get from wages and salaries etc
income after deduction of taxes+other mandatory charges
84
why is it important to diversify money when investing
generate inflation beating returns
allows you to grow your wealth
helps the environment
helps you stay out of debt
85
What is GNP?
gross national product
total market value of goods made by a country's economy in x amount of time
total value of goods made by a countries residents in U.S. or abroad
gross net product
86
you should get a debt consolidation if you have multiple loans
True
False
87
what is a partnership?
a legal entity that is separate and distinct from its owners
a relationship is a partnership
formal agreement by 2+ parties to operate business and share profits
they pay a fee to get a format and system made by a company+use their name
88
what is needed to make choices in economics?
sacrifices
opportunity costs
a brain
a need
89
what country do multinational corp most likely invest?
germany
china
japan
united states
90
what is a labor union
workers quit for better work conditions
workers come together and eat food
workers collectively bargain with employers for better work conditions
workers stop working for better work conditions
91
What is the benefit of credit cards
expands pool of customers who are guaranteed to pay
reduces friction in economy
all of the above
reduces cash and check handling
92
what is disposable income?
income remaining after deduction of taxes that one can spend on whatever
income that people get from wages and salaries etc
income after deduction of taxes+other mandatory charges
portion of income that the IRS determines as taxable
93
an entrepreneur does not take risks
False
True
94
What is the concept of principle when getting a loan
money originally agreed to pay back
cost of borrowing the money
giving the lender collateral when you don't pay back the money
principle runs a school
95
what is another term for a capitalistic system
supply and demand
free economy
mixed economy
market economy
