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Economics > Quiz 3-5 > Flashcards

Quiz 3-5 Flashcards

1
Q

What is a IQ ?

A

Import quotas

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2
Q

What does GDP stand for ?

A

Gross Domestic Product

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3
Q

What is V.E.R ?

A

Voluntary Export Restraints

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4
Q

If a GDP falls for 2 consecutive quarters, its called a what ?

A

Recession

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5
Q

Trade war

A

Escalating trade barriers

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6
Q

Name three durable goods in your home

A

Fridge, table, couch etc

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7
Q

Explain, in detail, what fracking is

A

It produces light crud, receiving oil from the ground with machines

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8
Q

M1 or M2 liquid assest

A

M1

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9
Q

M1 or M2 demand account

A

M1

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10
Q

M1 or M2 savings account

A

M2

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11
Q

M1 or M2 CD

A

M2

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12
Q

Name two reasons a country may devalue their currency

A

Increase exports and increase domestic spending

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13
Q

Name three things that might happen if a country devalues their currency

A

Increase unemployment
Slow economy
Growing debt payment
Decrease imports

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14
Q

How far apart should a expenditure approach and income approach be in discovering GDP

A

0%

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15
Q

Name the four parts of the business cycle

A

Expansion
Peak
Contraction
Trough

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16
Q

How does the government make more money ?

A

Taxation
tariffs
(Income tax)

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17
Q

What are intermediate goods ?

A

Materials used to make the final product

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18
Q

What happens to job growth in a recession ?

A

Unemployment increases

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19
Q

Who’s interest does the business have as a top priority ?

A

Shareholders

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20
Q

What happens to unemployment during a recession ?

A

Its increases

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21
Q

What happens to a business in a recession ?

A

Stop buying products, business could go out of business

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22
Q

Define Tariff

A

Tax on foreign goods

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23
Q

What are the three trade barriers we discussed in class ?

A

Import quotas: only so much product can come in
Voluntary export restrictions: only so much product can go out
Tariffs: a tax on foreign goods

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24
Q

What Economic System is the Parable of the Vineyard ?

A

Communism

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25
Q

What is a Trade Imbalance ?

A

When a nation puts out so much product, but brings a smaller amounts of imports (vice versa)

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26
Q

Why did Fracking become affordable ?

A

Fracking became affordable because gas price rose

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27
Q

In a free market economy you have periods of ________ and ____________

A

Surplus

Deficit

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28
Q

Name three reasons for Import Quotas

A

Protect U.S. manufacturing
Protect consumers
Protect prices

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29
Q

When unemployment is below 4%-5% it is effectively considered what ?

A

Full employment

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30
Q

Name three things that may cause inflation

A

Devaluing currency
A shortage
Raising minimum wage

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31
Q

Are we on the Gold Standard or on the Floating Exchange Rate (Floating Dollar) ?

A

Floating Dollar

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32
Q

Define Money Manipulation

A

Devaluing a currency on purpose to get around the tariff

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33
Q

A benefit for devaluing a country’s currency

A

Increasing exports

Increasing domestic spending

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34
Q

Costs for devaluing a country’s currency

A

Slow economy
Increasing unemployment rate
Increasing debt payments
Inflation

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35
Q

What is the name of Chinese currency ?

A

Yuan

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36
Q

Which of the following is not possible long-term negative impact on a nation’s economy if they devalue their currency ?

A

Lower debt payments

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37
Q

Which of the following is a short-term positive impact on a nation’s economy of they devalue their currency

A

Increased domestic spending on domestic goods

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38
Q

What are three positive things that may happen after a natural disaster ?

A

Employment rate
Government aid
Money from insurance

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39
Q

What are three negative things that may happen during/after a natural disaster ?

A

Business closes
Unemployment rates go up
Loss of assets

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40
Q

Define Shareholder

A

A owner of stock

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41
Q

Define Stakeholder

A

A person of interest or concern with something, especially a business

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42
Q

How might our government reduce spending ?

A

Military reduction and stopping infrastructure

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43
Q

Name three ways a Wal-Mart type of store may hurt a local economy

A

Have other stores go out of business
Keep paying at a cheaper price
Taking more product from other companies

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44
Q

Name three ways a Wal-Mart type of store may help a local economy

A

It’s well know
Helps get jobs
Cheaper prices

45
Q

Why do we have issues today with China as a trade partner ? Name three things

A

Devalue currency
To much imports
Steal our technology

46
Q

Do most countries carry external debt ?

A

Yes

47
Q

What is the desired outcome of our trade war with China ?

A

We will have more of a trade imbalance

48
Q

GDP is the, “dollar value of all final __________ and _________ produced within a country’s borders in a given year

A

Goods and services

49
Q

Does GDP include intermediate goods ?

A

No

50
Q

Would GDP include cars made in Ohio by a company owned by a Japanese company ?

A

Yes

51
Q

Would GDP include cars made in Brazil by an American owned company ?

A

No

52
Q

Your neighbor bought a brand new house in 2010. He was transferred to a new job in Georgia so he sold his house last week. Would this be included in the US GDP for this year ?

A

No

53
Q

In the above scenario, would the fee paid to the real estate agent who handled the resale of the house last week be counted in this year’s GDP ?

A

Yes

54
Q

You hired a contractor to build a new home for you today. Would the lumber, nails, shingles, windows, and doors be included in this year’s GDP ?

A

No

55
Q

In question #8, would the sale of the home be included in this year’s GDP ?

A

Yes

56
Q

When comparing the “Expenditure Approach” and the “Income Approach” for figuring out the GDP, should they give us the same total or very different totals ?

A

The same total

57
Q

Examples of durable goods

A 
Stove 
Car
Refrigerator 
Play Stations 
Computer 
Lazy Boy Chair
58
Q

Examples of nondurable goods

A

Blue jeans
Green beans
Air Jordan’s

59
Q

Does measuring the GDP help determine how well the economy is doing ?

A

Yes

60
Q

An economy is said to be in recession when GDP falls for how many consecutive quarters ?

A

Two consecutive quarters

61
Q

Does rising unemployment typically happen during periods of recession ?

A

Yes

62
Q

Does rising interest rates cause job growth to shrink or expand ?

A

Shrink

63
Q

Before we were on the “Floating Dollar” the U.S. had its mien backed by what valuable item ?

A

Gold

64
Q

When a country devalues its currency, do they typically see an increase or decrease in exports ?

A

Increase

65
Q

When a country devalues its currency, will their economy typically slow or grow in the long term ?

A

Slow

66
Q

What is the different we discussed in class between a Charge Card (like American Express) and a Visa card ?

A

Charge Card is 100% payed off monthly

Visa Card is when you have to pay back with interest

67
Q

What is a real estate appraisal ?

A

Estimation of value

68
Q

If you were approved for a secured loan, you may have to give some kin doc collateral. What is a collateral ?

A

Something you can secure a loan

Example- collateral on your house loan, you us you house

69
Q

If you default on a secured loan, they may _______________ your collateral

A

repossess

70
Q

What is P and I ?

A

Principle and interest

71
Q

If GDP decreases for ________ consecutive months, it is called a _____________

A

Six

Recession

72
Q

If your bank need a temporary loan, they would get that loan from the _____________ Bank

A

Central

73
Q

If Rason’s Smelly Shoe Company had a record year in sales, Name there things we discussed in class they may do with their profits

A

Expansion
More employees
More product

74
Q

____________ is King (Economically speaking)

A

Cash

75
Q

The greater the Risk the greater the potential ___________

A

Reward

76
Q

If you have lack of cash to pay you bills, you are cash ________

A

Poor

77
Q

The Federal Reserve Bank is also known as the ________

A

The Fed

78
Q

Who issues credit cards ?

A

Banks

79
Q

When you use a Visa debit card, do you pay a bill at the end of the month or do funds automatically come out of your checking account at the time of the transaction ?

A

Funds automatically come out of your checking account at the time of the transaction

80
Q

Is M1 money considered Liquid Assets or Fixed Assets ?

A

Liquid Assets

81
Q

Which typically has higher interest Checking accounts or Savings account ?

A

Savings

82
Q

Checking accounts are considered demand accounts, certificate account, savings accounts, or money market

A

Demand accounts

83
Q

Name a savings instrument that can be either short or long term, that earns interest, that has a penalty if you pull money out before its maturity date, and which typically locks in an interest rate

A

CD

84
Q

Who sets the rate which banks loan each other money

A

The Fed

85
Q

If you knowingly write checks without having the funds in the account, you may be guy of ________ _________

A

Check fraud

Example: Basically jail time

86
Q

The price paid for the use of borrowed money

A

Interest

87
Q

A paper currency issued during the Civil War

A

Greenback

88
Q

The ability to be used as, or directly converted into, cash

A

Liquidity

89
Q

Money in a checking account that can be paid out “on demand”

A

Demand deposit

90
Q

Objects that have value because the government has decreed that they are an acceptable means to pay debts

A

Fiat money

91
Q

Failing to pay back a loan

A

Default

92
Q

An institution for receiving, keeping, and lending money

A

Bank

93
Q

A card used to withdraw money from a bank account

A

Debt card

94
Q

Coins and paper bills used as money

A

Currency

95
Q

A widespread panic in which many people try to redeem their paper money at the same time

A

Bank run

96
Q

A monetary system in which paper money and coins had the value of certain amounts of gold

A

Gold standard

97
Q

The seizure of property from the borrowers who don’t repay their loans

A

Foreclosure

98
Q

A banking system thats keeps only a fraction of its funds on hand and lends out the remainder

A

Fractional Reserve Banking

99
Q

A bank that belongs to the Federal Reserve System

A

Member bank

100
Q

The direct exchange of one set of goods or services for another

A

Barter

101
Q

All the money available in the US economy

A

Money supply

102
Q

A bank that can lend to other banks in time of need

A

Central bank

103
Q

A specific type of loan that is used to buy real estate

A

Mortgage

104
Q

The amount of money borrowed

A

Principle

105
Q

Anything that serves a a medium of exchange, a unit of account, and a store of value

A

Money

106
Q

A card entitling its owner to buy goods and services based on the owner’s promise to pay for those goods and services

A

Credit Card

107
Q

A person or institution to whom money is owned

A

Creditor

108
Q

The amount the bank must keep inside the vaults

A

Reserve Ratio

Economics (10 decks)

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