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BEC > Module 42 Misc. > Flashcards

Module 42 Misc. Flashcards

1
Q

What is the effect when a foreign competitor’s currency becomes weaker compared to the U.S. dollar?

A

The foreign company will have an advantage in the U.S. market.

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2
Q

____ are government investments funded by foreign currency reserves that are managed separately from official currency reserves and invested for profit.

A

Sovereign Wealth Funds (SWFs)

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3
Q

________ is all income received by individuals whether earned or unearned and is computed before any deductions for personal income taxes.

A

Personal Income

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4
Q

_______ includes all income by American-used resources whether used/invested at home or abroad.

A

National Income

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5
Q

A city ordinance that freezes rent prices may cause:

A

Demand for rental space to exceed Supply

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6
Q

A(n) ____ competitive firm has a large number of small competitors

A

Monopolistic

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7
Q

A(n) ____ firm must deal with the issue of interdependence between the small number of large firms in the industry.

A

Oligopolistic

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8
Q

The dominant reason why countries devalue their currencies is to:

A

improve the balance of trade.

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9
Q

One of the key characteristics of emerging market economies include ____ (low/high) debt-to-GDP ratios

A

Low

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10
Q

One of the key characteristics of emerging market economies include significant ____ (increase/decrease) in trade among and between emerging market economies

A

Increase

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11
Q

One of the key characteristics of emerging market economies include ___ (low/high) cost labor

A

Low

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12
Q

One of the key characteristics of emerging market economies include ___ (low/high) savings rates

A

High

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13
Q

One of the key characteristics of emerging market economies include ____ (large/small) currency reserves

A

Large

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14
Q

One of the key characteristics of emerging market economies include ____ (low/high) investment in infrastructure

A

High

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15
Q

One of the key characteristics of emerging market economies include rapid growth in the number of ______ (low, middle, high) class consumers

A

Middle

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16
Q

A key rationale or cause for the changing pattern of investment in agriculture by sovereign wealth funds would be:

A

to ensure food security in the event that crop shortages would cause export bans that might curtail their ability to import crops.

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17
Q

_________ is gross domestic product for a particular year adjusted for inflation compared to a base year using a price index. This adjusted number is then divided by population.

A

Real per Capita Gross Domestic Product

18
Q

The Real per Capita Gross Domestic Product measure is used as an estimate of ____

A

of changes in well-being in a society over time

19
Q

T/F

The Real per Capita Gross Domestic Product measure is not one of the variables one would traditionally see in national income calculations.

A

TRUE

20
Q

Economic profit is generally _____ (lower/higher) than accounting profit due to the fact that ____ are included in the calculation of economic profits.

A

Lower

Implicit Costs

21
Q

T/F

The Federal Reserve Bank prints money when the level of M1 appears low

A

FALSE

The actual printing of currency is controlled by the US Treasury

22
Q

T/F

The Federal Reserve may sell government securities to control the supply of money

A

TRUE

23
Q

T/F

The Federal Reserve may change the reserve ratio to control the supply of money

A

True

24
Q

T/F

The Federal Reserve may raise or lower the discount rate to control the supply of money

A

TRUE

25
Q

How is the trough of a business cycle generally characterized?

A

Unused productive capacity and an unwillingness to risk new investments

26
Q

T/F

The trough of a business cycle is characterized by a specific sort of behavior with respect to costs and purchasing power

A

FALSE

The Trough of a business cycle is NOT typically characterized by these things

27
Q

What indicator does the federal government use to measure inflation?

A

Consumer Price Index

28
Q

What is the primary measure of the level of economic activity in the US?

A

GDP

29
Q

Bank reserves would be ____ (increased/decreased) by a sale of government securities by the Federal Reserve

A

Decreased

30
Q

A rise in price levels may result when costs of raw materials or labor increase. This type of price increase is called ____

A

Cost-Push Inflation

31
Q

What is the formula to calculate GDP?

A

GDP = C + lg + G + Xn

32
Q

The formula to calculate GDP is as follows:

GDP = C + lg + G + Xn

What does C stand for?

A

Personal Consumption Expenditures

33
Q

The formula to calculate GDP is as follows:

GDP = C + lg + G + Xn

What does lg stand for?

A

Gross Private Domestic Investment

34
Q

The formula to calculate GDP is as follows:

GDP = C + lg + G + Xn

What does G stand for?

A

Government Purchases

35
Q

The formula to calculate GDP is as follows:

GDP = C + lg + G + Xn

What does Xn stand for?

A

Net Exports

36
Q

In monopolistic competition, the goal of product differentiation and advertising is to…

A

make the firm’s demand curve less elastic so that consumers are less responsive to changes in price.

37
Q

The US Balance of trade is decreased by US ____ (imports/exports)

A

Imports

38
Q

A favorable balance of trade occurs when exports ____ imports. Increases in U.S. imports will _____ the U.S. balance of trade.

A

Exceed

Decrease

39
Q

How do you calculate the Reserve Ratio?

A

Reserves / Total Demand Deposits

40
Q

In the modern world economy, balance-of-payments deficits and surpluses can be eliminated through the market mechanism of….

A

Flexible Exchange Rates

Flexible exchange rates automatically adjust so as to eliminate balance of payments surpluses and deficits

41
Q

Induced investment is the investment made in an economy in response to…

A

Changes in the level of national income

BEC (17 decks)

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