Exam One Flashcards
According to the text, the term for the broad goal of promoting the sustenance and flourishing of life is…
well-being
According to the text, the three major macroeconomic goals are…
1) good living standards
2) stability and security
3) sustainability
Classical economics is best characterized with which statement below?
Taking advantage of the division of labor through specialization leads to economic growth.
Keynesian economics argues that the main way to get an economy out of a slump is to…
use fiscal policy to increase aggregate demand
Keynesian economics originated during which period?
The Great Depression
The four essential economic activities are…
1) production
2) consumption
3) distribution
4) resource maintenance
The term laissez-faire would be applied to which type of economy?
An economy with limited government regulation
What is Say’s Law?
Supply creates its own demand
Which one of the following is a normative statement?
Reducing unemployment should be the main goal of the government
Which one of the following is a positive statement?
Most economists believe the unemployment rate will increase next year
The gasoline tax should be increased is an example of a positive statement. (T/F)
False
Classical economics is based upon the notion of smoothly functioning markets. (T/F)
True
Classical economists tend to believe that an economy will achieve full employment in the long run. (T/F)
True
Keynesian economists tend to believe that unemployment can be persistent in an economy. (T/F)
True
The Classical Period in economics occurred after the Great Depression. (T/F)
False
