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

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