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Macro CH 1-9 Flashcards | StudBud
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Macro CH 1-9
Macro CH 1-9
60 terms
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review for midterm
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Questions
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Answers
1
Fiscal Policy refers to _____ and Monetary Policy refers to
self interest and money
taxes and self interest
taxes & government spending and interest rates
taxes and the value of a dollar
2
What system measures the overall well being of the economy
Nominal GDP
Fiscal Policy
National Income Accounting
Monetary Policy
3
Positive economics focuses on ____ and normative economics focuses on _____
demand side; supply side
facts and cause-effect relationships; value judgments
supply side; demand side
unusual relationships; value judgments
4
What diagram illustrates the flow of good&services, resources&money thru households&businesses
the unleaded diagram
the square box diagram
the fully leaded diagram
the circular flow diagram
5
Scarcity
has no relevance to economic theories
demands options and restricts choices
has some relevance to economic thoeries
restricts options and demands choices
6
The CPI does all of the following except
measure a basket of goods
determine income tax brackets
determine inflation
determine projected income
7
Regarding the annual rate of economic growth, the Rule of 70 calculates
the rate of inflation
the GDP per capita
the number of years for real GDP to double
the real GDP
8
Households are the main source of saving and businesses are the main economic investors
true
false
9
Firms seeking to further self interest and operating a competitive market system are lead by
laws and virtues
envy and jealousy
an invisible hand
a dough hook
10
Gross Domestic Product is calculated by
C + S + G + Xn
C + S + G - Xn
C + Ig + G + Xn
C + Ig + G - Xn
11
Supply side market failures occur when supply curves show the cost of producing a good/service
false
true
12
The expenditure approach to calculating the GDP = consumer spending +
business spending + government spending + exports
business spending + government spending + net imports
business spending + government spending + net exports
business spending + government spending + net income
13
What type of economic system has the least amount of government intervention?
laissez-faire
socialism
fiscal policy
command
14
What is the correct order of the business cycles
peak, recession, trough, expansion
peak, recession, expansion, trough
peak, growth, trough, expansion
peak, growth, expansion, trough
15
What is an event that occurs in the economy that was unexpected?
an economic shock
an upswing in the real GDP
the invisible hand
government intervention
16
Market systems require
buyers and sellers
the exchange of goods but not services
supply and demand
the exchange of services but not goods
17
Net exports =
exports + imports
export - imports
imports - exports
imports + exports
18
Macroeconomics focuses on
the economy as a whole
individual consumption
unemployment
individual behavoirs
19
What is an example of a public good
medicare
clothing
coffee
personal computers
20
Complimentary goods are
golf balls and fly swatters
tennis balls and tennis rackets
tennis balls and golf clubs
golf balls and tennis rackets
21
Aggregate is the
collection of specific economic units treated as one unit
collection of specific economic units treated as two units
collection of specific economic units treated as three units
collection of specific economic units treated as four units
22
What is a source of government failure
market failures
the massive size and scope
the invisible hand
nominal GDP
23
Utility is the
dissatisfaction from obtaining a good or service
surprise from obtaining a good or service
pleasure or satisfaction from obtaining a good or service
anxiety from obtaining a good or service
24
All of the following are stabilization policies except for
judicial policy
fiscal policy
monetary policy
25
A mixed economy is a
open system
market system
command system
closed system
26
Productive efficiency is when the production of a good occurs in the most costly way
false
true
27
Ceteris paribus is the
all things fair assumption
all things square assumption
all things unequal assumption
all things equal assumption
28
Which of the following is an example of inflation
cost demand inflation
supply demand inflation
cost push inflation
demand push inflation
29
Economic growth is measured in all of the following except
actual GDP over time
nominal GDP over time
real GDP over time
real GDP per capita over time
30
What do business cycles reflect?
recurring upswings and downswings in real GDP
recurring upswings and downswings in nominal GDP
increases in equilibrium
decreases in equilibrium
31
You could do well on the midterm unless
you don't adhere to the academic honesty policy
review the textbook and chapter notes provided
you don't bring a number 2 pencil
you don't take the time to study
32
Unemployment is classified by all of the following except
frictional unemployment
cyclical unemployment
structural unemployment
impartial unemployment
33
The inverse relationship between price and quantity is the
law of demand
law of supply
law of services
law of goods
34
Substitute goods are
bread and butter
restaurants and barber shops
coke and pepsi
CDs and airplane tickets
35
A negative externality occurs when
the total cost of producing a good isn't what a producer pays
the total cost of producing a good is more than a producer pays
the total cost of producing a good is equal to what a producer pays
the total cost of producing a good is less than a producer pays
36
GDP can be calculated by all of the following except
product or output
IOUs
expenditure or spending
income
37
A budget line is a schedule/curve that shows various combinations of
unlimited products a person can purchase w/ unlimited income
2 products a person can purchase with a unlimited income
unlimited products a person can purchase with an income
2 products a person can purchase with a specific income
38
Unemployment is not calculated with
those employed
those seeking employment
part time workers
discouraged workers
39
What do public goods not have
rivalry
non rivalry
non excludability
free rider
40
An example of a final good is
wheat flour
bread
water used to make bread
a seed to plant a stalk of wheat
41
What is the key difference between public and private firms
Private firms contribute to real GDP, public firms do not
Public firms can force people to do things
Public firms can cease to exist
Private firms must return a profit
42
The 4 economic resource categories are:
land, labor, capital & economic ability
land, labor, capital & endurance ability
land, labor, capital & entrepreneurial ability
land, water, capital & entrepreneurial ability
43
Choosing one activity over another activity refers to
opportunity cost
supply and demand
market failures
nominal GDP
44
Final goods and services
are purchased by end users
are offered as imports
are offered for resale
are offered as exports
45
The government's ability to coerce enhances economic activity by
eliminating inequality
correcting market failures
adding to market failures
encouraging inequality
46
The law of supply shows the relationship between price rising and quantity rising and
price falling and quantity falling
price rising and quantity falling
price falling and quantity rising
price falling and quantity stays the same
47
Positive externalities are the result of demand side market failures
true
false
48
Economic shocks occur when something is expected to happen but something else happens
true
false
49
GDP per capita equals
population/GDP
GDP/consumption
consumption/GDP
GDP/population
50
GDP is a calculation of
the value of raw goods and services produced in an economy in a year
the value of final goods and services produced world wide in a year
the value of final goods and services produced world wide in a year
the value of final goods and services produced in an economy in a year
51
A positive externality occurs when
benefits occur to third parties
consumers assume all costs
negativity occurs to third parties
producers assume all costs
52
Determinates of growth are all of the following except
supply factors
nominal factors
efficiency factors
demand factors
53
GDP measures the total dollar value of all goods/services produced in a country's border
false
true
54
All of the following are unfunded liabilities except for
medicare
unemployment payments
social security
55
Allocative efficiency is the mix of goods and services most valued by society
false
true
56
Demand side market failures happen when demand curves reflect the consumers' willingness to pay
true
false
57
What system rests on private ownership of property & freedom of enterprise and choice
market
closed
open
command
58
Inflation is the general rising of price levels
false
true
59
All of the following are reasons for government failure except
no invisible hand
massive size and scope
no bureaucracy
abundance of paperwork and inflexibility
60
Pigovian taxes are government taxes levied on
all goods and services
neither a good or a service
specific goods and services
anything but a good or service
