Principles of Economics

Question 1

Microeconomics

Answer 1

Examines the behaviour and decisions of individual firms and households and the way they interact in specific industries and markets

Question 2

Macroeconomics

Answer 2

Examines the workings and problems of the whole economy, looking at features such as GDP growth and unemployment

Question 3

Examples of microeconomics

Answer 3

College tuition, health care policy debate, housing boom and bust, Income distribution

Question 4

Examples of macroeconomics

Answer 4

Recession of 2007-09, Economic growth of China v Africa, Monetary policy and Fiscal Policy

Question 5

Capital Gain

Answer 5

Income you gain by selling an asset i.e. property or shares

Question 6

Fiscal Policy

Answer 6

Use of government spending and taxation to influence the overall economy

Question 7

Monetary Policy

Answer 7

A set of actions available to a nations central bank to achieve sustainable economic growth by adjusting the money supply. i.e. bank of England adjusting interest rates to adjust inflation

Question 8

Gross Domestic Product

Answer 8

Measure of all the goods and services produced in a country over a year

Question 9

Real Gross Domestic Product

Answer 9

Measure of all the goods and services produced in a country over a year adjusted for inflation