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AP Macro - Unit 4 FRQ Review Flashcards | StudBud

Explore/AP Macro - Unit 4 FRQ Review

AP Macro - Unit 4 FRQ Review

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Questions 8

Answers

1
Reserve ratio= 20%; the bank loans out all excess reserves; how much can money supply grow?
$40
$60
$52
$12
2
What impact would the below graph have on GDP output, unemployment, and interest rates?
GDP increases; UE decreases; interest rates decrease
GDP decreases; UE increases; interest rates increase
GDP increases; UE increases; interest rates increase
GDP decreases, UE decreases; interest rates decrease
3
What impact would the below graph have on price level, unemployment, and GDP output?
PL decreases; UE decreases; GDP decreases
PL increases; UE increases; GDP increases
PL increases; UE decreases; GDP increases
PL decreases, UE increases, GDP decreases
4
What causes the shift depicted in the below graph?
the FED buys bonds
federal government increases taxes on all americans
technological breakthrough
government is operating with a budget surplus
5
What monetary policy could the FED take to combat the current state of economy as shown below?
cut income taxes
increase government spending
increase the discount rate
buy bonds
6
What impact would the below graph have on interest rates, aggregate demand, and employment?
interest rate increases; AD increases; employment increases
interest rate decreases; AD increases; employment increases
interest rate decreases; AD decreases; employment decreases
interest rates increase; AD decreases; employment decreases
7
What would cause the below shift depicted in the graph?
FED lowers the reserve ratio
Government increases taxes
FED raises the discount rate
FED buys bonds
8
If the required reserve ratio is 20%; how much money can this specific bank loan out?
$12
$48
$52
$40