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Econ 1000 Chapters 7-9 Study Guide
Econ 1000 Chapters 7-9 Study Guide
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KSU Contemporary Economic Issues Exam 3 #economics
Flashcards
67 cards
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Questions
67
Answers
1
Between 2016 and 2018, the number of people in the Labor Force did what while Unemployment Rate did what?
D. BOTH decreased.
A. Increased; Decreased.
C. BOTH Increased.
B. Decreased; Increased.
2
A good that is used in the production process of making a bench is called a(n) what?
C. An intermediate good
D. A permanent good
A. An inferior good
B. A necessary good
3
What refers to the periodic but irregular fluctuation in overall macroeconomic activity which occurs over time?
B. Business Cycle
C. Money Velocity
A. Stabilization
D. None of the above
4
The outward shift of the PPF (from 1986 PPF to 2016 PPF) which occurred btwn 1986 and 2016 could be best described as:
C. Economic growth.
D. Economic development.
A. An increase in demand.
B. Inflation.
5
For this country, Gross Domestic Product is equal to how much?
B. $1,482 million.
D. $1,874 million.
A. $897 million.
C. $1,678 million.
6
Which function of money is deteriorating when there is a
high
inflation?
B. Unit of account
C. Standard of deferred payment
D. Store of value.
A. Medium of exchange
7
Which is the ultimate goal of monetary policy?
B. Economic growth with low inflation.
D. A favorable exchange rate of the dollar.
C. Zero unemployment.
A. Interest rate stability.
8
How many people are in the labor force of this society?
B. 2,500,000
D. 500,000
A. 4,000,000
C. 2,300,000
9
Find this society's Unemployment Rate:
A. 5%
B. 8%
C. 20%
D. 42.5%
10
Choose the BEST answer for this question:
B. US
D. None of the above answers are correct.
C. Mexico
A. Canada
11
How many people are in the labor force of this society?
D. 500,000
A. 4,000,000
C. 320,000
B. 2,500,000
12
Lower income countries, held back by poor economic institutions, undeveloped industrial capital, etc. refer to what?
D. Economically Superior
C. Industrially Advanced
A. Commercially Developed
B. Less Developed
13
Suppose that “County K” were to realize a constant GDP Growth Rate of 9%/yr. Real GDP would double in how many years?
C. 25
A. 4
D. 72
B. 8
14
A good that is used in the production process that is
not
(itself) a final good or service is a which?
A. An inferior good
B. A necessary good
D. A permanent good
C. An intermediate good
15
Define brain drain:
C
B
D. None of the Above
A
16
In which year was the Misery Index
GREATEST
in value?
A. 2013.
B. 2015.
D. 2019.
C. 2017.
17
The arguments made by John Maynard Keynes suggest that during an economic downturn, the government should do what?
D
C
B
A
18
Which describes “Great Misery”?
D. Unemployment + Inflation Rate was 12.5+ for 116 months.
C. Obama was President and unemployment rate was above 20% for 17 months.
A. Bush was President and the U.S. Federal budget deficit inc. by 234%.
B. Abnormally high inflation rates were realized from the 1970s-1980s.
19
Find this society's Unemployment Rate:
D. 40%
C. 20%
A. 5%
B. 8%
20
The knowledge, education, skills, experience, work ethics, and other attributes refer to which of the following?
D. Technology
A. Physical Capital
C. Worker Mortality
B. Human Capital
21
If the money supply is $80 billion, the velocity of money is 5, and real GDP is $320 billion, find the price level.
C. 4..
D. 1.25.
B. 20.
A. 51.2.
22
“The General Theory of Employment, Interest and Money” was written by who?
D. Keynes
C. Thatcher
A. Friedman
B. Schwartz
23
Which of the following statements about seasonal unemployment is
true
?
D. It is the type of unemployment associated with discouraged workers.
B. It is likely to be affected by changes in consumer preferences.
A. It is associated with jobs that are affected by weather changes.
C. It results primarily from downturns in economic activity.
24
Which business cycle phase does the overall economic activity reach its maximum?
B. Peak
C. Recession
D. Trough
A. Recovery
25
The U.S. economy grew for an uninterrupted 10 year period from which time frame?
B. Mar 1991-2001
A. Aug 2002- Present Day
D. Jun 1967-1977
C. Sep 1979-1989
26
A first-draft college basketball star who has a month off before reporting to his new NBA team is an example of what?
B. Structural
D. Technological
C. Cyclical
A. Frictional
27
What is an extremely high rate of inflation, generally above 100% per year?
A. Deflation
B. Hyperinflation
C. Unemployment
D. None of the above
28
THREE people in the following scenarios are unemployed. Who is
NOT
one of them?
C. The Teacher
D. The Retiree
A. The auto worker
B. The College Student
29
Karen graduated from college 3 months before she found a good job.How was she unemployed between grad & her 1st workday?
C. Frequently unemployed.
A. Cyclically unemployed.
B. Frictionally unemployed.
D. Structurally unemployed.
30
What refers to government policies with the primary aim of minimizing fluctuations in overall macroeconomic activity?
C. Stabilization
B. Distribution
A. Allocation
D. Taxation
31
THREE of the following are primary policy tools used by a central bank. Which one is
NOT
?
A. Setting the “discount rate.”
C. Setting “reserve requirements.”
B. Loaning money to low income home buyers at below market interest rates.
D. Open Market Operations
32
Define Rule of Law:
B
D
A
C
33
Find the Unemployment Rate in 2016.
A. 24%
B. 20%
C. 5%
D. 4%
34
Choose the BEST formula for "The Equation of Exchange":
D. V = PQ.
B. MQ = PV.
C. MP = VQ.
A. MV = PQ.
35
If C=$897, I=$221, G=$235, M=$86, X=$104, find the value of GDP for this country (C+I+G)+(X-M):
B. $234M
A. $18M
C. $1371M
D. $1543M
36
A society can achieve economic growth how?
B. By making deliberate investments in overhead capital.
C. By realizing an improvement in technology.
A. By making deliberate investments in human capital and physical capital.
D. More than one (perhaps all) of the above answers is correct.
37
Monetary Policy in the United States is determined by whom?
D. Legislative Branch
B. Judicial Branch
C. Executive Branch
A. The Fed
38
Choose the BEST answer for this question:
C. ONLY The Bahamas
A. ONLY Colombia
D. None of the above answers are correct.
B. Only the US
39
For a hypothetical economy in a given year, GDP=$10500, C=$9800, G=$125, X=$250, and M=$500. Solve for I.
C. $825
D. $250
B. $245
A. $380
40
A steelworker who has been laid off during a recession is an example of which unemployment?
D. Search
B. Seasonal
A. Frictional
C. Cyclical
41
Choose the BEST answer for this question:
C
A
D
B
42
For a hypothetical economy in a given year, GDP= $10,000, C= $9,800, I=$125, X= $255, M= $500. Solve for G.
C. $200
D. $320
A. $380
B. $245
43
Define Inflation:
A. Any increase in the general price level.
C. A sustained increase in relative prices.
B. A sustained increase in the weighted average of ALL prices.
D. An increase in the prices of specific products.
44
Suppose that “County Z” were to realize a
constant
GDP Growth Rate of 4%/yr. Real GDP would
double
in how many years?
A. 4
D. 72
B. 18
C. 25
45
Define “Misery Index”:
C. Fraction of Population Clinically Depressed.
A. Economic indication created by Arthur Okin.
D. More than one (perhaps all) of the above answers is correct.
B. Unemployment Rate • Inflation Rate
46
The “Catch-up effect” suggests what when all other factors are fixed?
D
C
A
B
47
How many people are in the labor force of this society?
D. 1,600,000
C. 1,000,000
B. 920,000
A. 700,000
48
If the money supply is $600 million, real GDP is $2,100 million and nominal GDP is $3,600 million, find money velocity.
D. 6.
A. 3.5.
C. 10.3.
B. 1.7.
49
In which year did this country realize “
deflation
”?
C. 2015
B. 2017
D. 2013
A. 2019
50
Define Economic Growth:
B. Sustained increases over time in a society’s value of real GDP.
A. A result of whether or not a country has access to natural resources.
C. An inward shift of the Production Possibilities Frontier.
D. More than one (perhaps all) of the above answers is correct.
51
“Fiscal Policy” can be described as government policy serving which purpose?
A. Determine money supply of the economy.
B. Change the underlying institutions of a nation’s economy.
C. Generate spending and revenue.
D. Secure the borders and protect the homeland of a nation.
52
Choose the BEST answer for this question:
D. Brain Drain.
B. Vicious-cycle-of-property.
A. Rule of 72.
C. Catch-up effect.
53
If this society had instead chosen “Point B” in 1986, then the relevant PPC in 2016 would likely lie where in the graph?
D. Beyond "2016 PPC".
B. Between “1986 PPC” and “2016 PPC”.
A. Below “1986 PPC”.
C. EXACTLY "2016 PPC".
54
If the country’s unemployment rate is 5% and inflation rate is 2%, what is the misery index for that country?
D. Cannot be computed from the information provided in the table.
A. 7%
C. 2%
B. 5%
55
This type of unemployment arises as one of the worst effects of a recession.
B. Static
D. Frictional
C. Cyclical
A. Seasonal
56
Choose the BEST answer for this question:
B. Hypothetical; Actual
D. Real; Nominal
A. Actual; Hypothetical
C. Nominal; Real
57
The phase of the business cycle that refers to the period of time which an economy is contracting is a what?
B. Peak.
A. Recovery.
C. Recession.
D. Trough.
58
Find unemployment rate:
D. Cannot be computed from the information provided in the table.
A. 4.25%
B. 5%
C. 8%
59
How can The Federal Reserve can increase the Money Supply in the U.S.?
D. More than one (perhaps all) of the above answers is correct.
A. Sell U.S. Treasury debt securities to the public.
C. Decrease Discount Rate.
B. Increase RRR.
60
For this country, “net exports” are equal to how much?
B. $234 million.
C. $430 million.
A. $38 million.
D. $1,874 million.
61
Choose the BEST description for "Vicious-cycle-of-poverty".
D
B
C
A
62
If nominal GDP is $18,600 million and the money supply is $6,000 million, then the velocity of money is equal to what?
D. 49.6.
C. 0.02.
B. 12.4.
A. 3.1.
63
Choose the BEST formula for "Official Unemployment Rate":
D. Unemployed/Labor Force
A. Unemployed/Employed
B. Unemployed/Total Size of Population
C. Unemployed/Size of the Non-institutionalized Population
64
Choose the BEST formula for “Real GDP Per Capita”:
D. Real GDP/Total Population
B. Real GDP - Nominal GDP
A. Real GDP/Nominal GDP
C. Real GDP ⋅ Total Population
65
Choose the BEST answer for this question:
D. The Rule of 72.
A. Economic growth.
B. Rule-of-Law.
C. Crony capitalism.
66
Choose the BEST answer for this question:
D. Economically Superior.
A. Commercially Dependent.
C. Industrially Advanced.
B. Less Developed.
67
Which policy can potentially be used by the government in order to stabilize the performance of the macroeconomy?
B. Monetary
D. BOTH Fiscal and Monetary
A. Neither Monetary NOR Fiscal
C. Fiscal
