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EPF - Unit 2 - Micro and Macro Economics Flashcards | StudBud
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EPF - Unit 2 - Micro and Macro Economics
EPF - Unit 2 - Micro and Macro Economics
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1
Which of the following is a characteristic of nongovernmental organizations (NGOs) in the United States economy?
They provide financial products and services to individuals and businesses
They aim to generate profits for their owners or shareholders
They are not owned or operated by the government
They regulate economic activity
2
Which of the following is a characteristic of government organizations in the United States economy?
They produce goods and services for profit
They are owned and operated by private individuals or companies
They are a key source of employment and economic growth
They are owned and operated by the government
3
A central bank is looking to stimulate economic growth during a recession. Which action would be most effective?
Lowering interest rates
Raising interest rates
Decreasing the money supply
Increasing the money supply
4
Which of the following is a characteristic of private sector organizations in the United States economy?
They can only be classified as for-profit
They are owned and operated by private individuals or companies
They produce goods and services for the government
They are a key source of employment and economic growth
5
Which of the following typically corresponds with an increase in the unemployment rate?
A period of stable economic growth
A period of economic expansion
A period of low inflation
A period of economic contraction
6
Which of the following organizations may play a role in economic stabilization efforts?
Business organizations
Environmental groups
Lobbiest
Political parties
7
What is economic stabilization?
The efforts to increase the total value of goods and services produced
The efforts to encourage borrowing and spending by lowering interest rates
The efforts to increase the overall level of prices for goods and services
The efforts to maintain a healthy level of economic growth
8
Which of the following is a characteristic of financial institutions in the United States economy?
Regulating economic activity
Manufacturing goods
Redistributing income through programs such as social security
They provide financial services, such as banking and credit union services
9
Which of the following is a potential negative outcome of increasing taxes during a recession?
It can increase business profits
It can be politically popular
It can increase government debt
It can reduce disposable income and slow down economic activity
10
What are basic microeconomic indicators used to track?
Changes in the stock market
Changes in the cost of living
The aggregate measures of an economy, such as GDP and unemployment
The overall performance of individual firms and industries within a economy
11
What does an increase in Gross Domestic Product typically indicate?
A period of unstable economic variation
A period of high inflation
A period of economic contraction
A period of economic expansion
12
Which of the following typically corresponds with a rise in the stock market?
A period of stable economic growth
A period of economic expansion
A period of economic contraction
A period of high inflation
13
A company has experienced an increase in employment and wages over the past year. What is the most likely cause?
An economic expansion causing higher demand and higher prices
A recession causing lower demand and lower prices
An increase in the cost of raw materials
A natural disaster disrupting the supply chain
14
Which of the following is a characteristic that is common to both a recession and a depression?
Rising asset prices
Political instability
Economic expansion
Economic contraction
15
Which of the following real-world scenarios would be an example of prices as a microeconomic indicator?
A natural disaster disruptsthe supply chain, leading to increasing prices
All of the above
A government increases taxes to reduce demand for a certain product
A company raises the price due to an increase in the cost of raw materials
16
Which of the following actions could a government take to stimulate economic growth during a recession?
Increase taxes
Decrease government spending
Increase government spending and lower interest rates
Raise interest rates
17
Which of the following typically occurs during a period of economic expansion?
A rise in the unemployment rate
An increase in the inflation rate
A decrease in production and sales
An increase in production and sales
18
What is the primary goal of central banks when it comes to the inflation rate?
To stimulate economic growth
To increase the purchasing power of consumers
To maintain a high, unstable inflation rate
To maintain a low, stable inflation rate
19
Which of the following is NOT a tool used by the government to stabilize the economy?
Fiscal policy
Infrastructure projects
Monetary policy
Social media campaigns
20
Which of the following organizations is responsible for implementing monetary policy in the United States?
The Federal Reserve System
The Department of Commerce
The Council of Economic Advisers
The International Monetary Fund
21
A company has experienced a decline in profitability over the past year. Which is the most likely cause?
An increase in the cost of raw materials
Lower demand and lower prices
Increased demand and higher prices
A natural disaster disrupting the supply chain
22
Which of the following organizations is a nonprofit organization?
A charity that raises money to support people in need
A grocery store that is owned by a private individual
A university that is funded by tuition and donations
A hospital that is run by the government
23
What is a key difference between a recession and a depression?
A recession is much more severe and prolonged than a depression
A depression has high unemployment, while a recession has low unemployment
A depression is much more severe and prolonged than a recession
There is no significant difference between a recession and a depression
24
What is the primary goal of economic stabilization efforts in the United States?
To promote economic growth and reduce economic fluctuations
To increase the price level for goods and services
To encourage borrowing and spending
To decrease the overall well-being of citizens
25
Which of the following actions would a central bank typically take during a recession to stimulate economic activity?
Decrease the money supply
Raise interest rates
Lower interest rates
Increase government spending
