Beruflich Dokumente
Kultur Dokumente
1.
2.
The highest income countries per person are also the countries with the highest:
a. savings per person
b. consumption per person
c. capital per person
d. consumption to investment per person
3.
4.
According the United Nations, what is the biggest obstacle to economic development for poor
nations in the world today?
a. too much debt
b. treatment of women
c. child labor
d. poor transportation systems
5.
6.
(True/False) The United States has both a high savings rate and a high rate of innovation,
which is why it grows so fast.
7.
(True/False) While all countries with lots of natural resources have good economic growth,
lack of resources does not prevent economic growth.
8.
(True/False) The phrase maximum sustainable growth means that creating economic
growth will automatically create stable prices and full employment.
9.
10.
________ (True/False) The Employment Act of 1946 requires the government to maintain full
employment, regardless of inflation.
11.
The Classical economic philosophy of hands off is expressed by the French phrase:
______________________________________________________________________________
12.
13.
In the current economic crisis, a Classical economist would have done what with the failing
banks and insurance companies?
a. let them go bankrupt, regardless of effect on anything else
b. let them go bankrupt, with the Fed protecting other financial institutions affected by it
c. forced another financial institution to buy them, with help from the Fed
d. exactly what the Fed did, buy billions in their stock to increase their reserves
14.
15.
(True/False) Data tell us that changing taxes has the strongest effect on the economy when
times are good, and less effect as times go bad.
16.
(True/False) All economists agree the government can effect the economy in a positive way.
17.
(True/False) The USA has traditionally used industrial policy, other countries have not.
18.
19.
When lowering interest rates does not affect the economy, economists say that we are in a(n)
_____________________________________________________________________________
20.
21.
22.
(True/False) It is easy and quick for the Fed to change the money supply or interest rates,
but it may months before the impact of that change filters through the whole economy.
23.
(True/False) The correct monetary policy to use during a demand recession would be to lower
interest rates and lower the money supply.
24.
25.
The idea that there is a tradeoff between inflation and unemployment in the short run is:
a. Greshams Law
b. The Phillips Curve
c. Keynes Conundrum
d. The Laffer Curve
Key Questions from Earlier: (NOTE: THERE WILL BE THINGS ON THE TEST NOT COVERED
HERE, THESE ARE THE QUESTIONS FROM YOUR TESTS THAT I THINK ARE MOST
IMPORTANT!)
1.
2.
_________________ means that the value of the dollar has fallen because the market made it.
3.
(True/False) An increase in exports should make the value of your currency rise.
4.
(True/False) If the value of the dollar is falling against the Yen, it must be falling against all
other currencies as well.
5.
6.
If the U.S. has a balance of trade deficit and exchange rates are free to float, this deficit:
a. should fix itself because the value of the dollar will fall
b. should fix itself because the value of the dollar will rise
c. can only be fixed through government intervention
d. should fix itself through movements of gold between nations
7.
8.
GDP equals:
a. C + I + T + (X-M)
b. C + S + G + (X-M)
c. C + I + G
d. C + S + T
9.
10.
11.
12.
13.
14.
(True/False) Says Law tells us that people decide how much to save, and the amount they
consume is the left-over after they make the saving decision.
15.
(True/False) Classical economists believe that the economy is stable and self-correcting.
Figure 1
16.
17.
On Figure 1 on the answer sheet, draw a line to represent how the Classical economists
believed the gap would be eliminated.
18.
The change you drew in #16 would happen, according to Classical economists:
a. only through government spending and taxing changes
b. because wages fall, without any government action
c. because wages fall, caused by actions of the government
d. because wages rise, without any government action
19.
20.
Suppose my income this month is $10,000 and I spent $9,000, and last month my income was
$9,000 and I spent $8,200. What is my MPC?
_______________
21.
If my MPC is what you calculated in #21, a $10 billion increase in government spending
would cause how big a change in GDP?
$___________B
22.
23.
____________(True/False) Supply side economics is based in part on the idea that tax cuts for
the rich will trickle down and help the poor and middle class.
24.
_________(True/False) New Classicals and New Keynesians believe that the Classicals were
right in the long run, but disagree about how the economy works in the short run. This is
called the Neo-Classical Synthesis.
25.
26.
The ________________________ of money is the average number of times each dollar is spent
each year.
27.
28.
29.
30.
When David Hume said that money was the oil of trade, he meant which function of money?
a. medium of exchange
b. store of value
c. moderator of wealth
d. unit of account
31.
33.
_____
34.
35.
When the Fed does what it says in #34, interest rates should:
a. fall
b. rise
c. remain unchanged
36.
The ______________ rate is what the Fed charges banks when they borrow from it.
37.
38.
M1 is mainly:
a. cash and coins
b. currency and checking accounts
c. currency, checking accounts, and small savings and time deposits
d. a freeway in London
Bills National Bank
Loans: $15,000
Securities: $10,000
Deposits: $30,000
Required Reserve Ratio = 10%
39.
40.
41.
42.