Study Guide Flashcards
Buying a new home is an example of (investment, consumption, net exports, government spending, or not part of GDP)
Investment
South Korea buys 10 Ford Explorers from a dealership in Georgia is an example of (investment, consumption, net exports, government spending, or not part of GDP)
Net exports
Illegal drugs are an example of (investment, consumption, net exports, government spending, or not part of GDP)
Not part of GDP
$1 million spent on insect research by the state of Florida is an example of (investment, consumption, net exports, government spending, or not part of GDP)
Government spending
You buy a homecoming dress from JC Penny’s off the clearance rack is an example of (investment, consumption, net exports, government spending, or not part of GDP)
Consumption
Buying a used car off a sale as in the newspaper is an example of (investment, consumption, net exports, government spending, or not part of GDP)
Not part of GDP
8% of Americans are out of a job due to a current recession
(Frictional unemployment, structural unemployment, cyclical unemployment, or not unemployed)
Cyclical unemployment
Jimmy quit his job to take care of his sick mother and father
(Frictional unemployment, structural unemployment, cyclical unemployment, or not unemployed)
Frictional unemployment
A person with a chemistry degree is working at Domino’s
(Frictional unemployment, structural unemployment, cyclical unemployment, or not unemployed)
Not unemployed
In the 1970’s many Americans lost their auto manufacturing jobs to Asia (Frictional unemployment, structural unemployment, cyclical unemployment, or not unemployed)
Structural unemployment
Your favorite teacher gets married and has to look for a new job in Maine (Frictional unemployment, structural unemployment, cyclical unemployment, or not unemployed)
Frictional unemployment
Does INFLATION increase or decrease the value of money?
Decrease
Does DEFLATION increase or decrease the value of money?
Increases
In GDP which sector is the largest dollar amount? (Investment, government spending? Consumption, or net exports)
Consumption
Which of the following is the best measure of the production/output of an economy (GDP, CPI, Prime rate, or unemployment rate)
GDP
What problem might policy makers be trying to address MOST if they increase funding for training programs covering skills such as computer repair; programming, and networking? (Frictional, structural, cyclical, or seasonal unemployment)
Structural unemployment
When the actual inflation rate is greater than the anticipated inflation rate, who is most likely to suffer?
Those who lend at a fixed interest rate
What transaction would represent an addition to a nations current gross domestic product?
The government increasing its domestic purchases of food for the military
What is a good example of a final good or service
A cake purchased from a bakery for a wedding
In a typical business cycle what stage immediately follows a peak?
Contraction
Concern about an international crisis has caused consumers to save their money and postpone big purchases and investments. What is the effect on aggregate demand?
Aggregate demand will decrease
When the price level falls, consumers and firms buy more goods and services. This relationship is represented by the
Aggregate demand curve
How do fears for future economic problems affect GDP?
Consumers and businesses will spend less and save money for a future economic contraction; GDP will decrease
The largest sector of the macroeconomy is (foreign, investment, government, or consumer)
Consumer
Economic growth benefits the government by
Enlarging the tax base
The benefits of long term economic growth doesn’t include
An increase in the availability of land
What will a price ceiling set by the government create? (Surplus or shortsge)
Shortage
___ ___ ___ - An index of the average level of prices for all goods and services in the economy
Consumer Price Index
What will a price floor set by the government create? (Surplus or shortage)
Surplus
Which of these is most likely to lead to inflation
An increase in the costs of production
Over a two year period the nation of Parthia experiences a steep decline in unemployment rate, a rise in real GDP, and a stabilized price level. Parthia appears to be
In the middle of a boom period
Which of the following results when federal government expenditures are less than the federal governments total receipts?
A federal budget surplus
