Macroeconomics Arnott (DBU)
The Federal Reserve Bank controls:
Interest rates and money supply
Of the four elements that make up the GDP measure, which is the one that is the sum of purchases of capital equipment.
Investment
President Trump's tariffs on steel and aluminum are an example of:
Inward-oriented policies
The Consumer Price Index is used to calculate which of the measures on the macro model
Inflation
The difference between nominal and real interest rates, is that the real rate is adjusted for:
Inflation
Fiat money is:
Issued by government decree (government money)
In "Measuring World Poverty as it Shrinks," Nobel Prize winning economist Angus Deaton says what about that $5 trillion spent on aid
It has harmed their governance structures
When calculating GDP, the sale of a used car is counted as:
It's not counted
Who won the fight between Keynes and Hayek?
Keynes
The Long Run Aggregate Supply curve is shifted by the same indicators that we find in the BRIC model
Labor, Capital, and Natural Resources
The BRIC diagram predicts that countries will have higher productivity based on their use of:
Land, Labor, and Capital
The BRIC model uses the same three elements that the circular flow says households supply to firms:
Land, Labor, and Capital
Economists build economic models by
Making assumptions
The Greek Word "oikomonos" means:
Management of Household
Principle 3 is: "Rational People Think at the:" (This is sometimes called the "adding one more" rule.)
Margin
In the GDP definition, "GDP is like ________ value" because it's measured by the equilibrium point, where a supplier will sell and a buyer will purchase.
Market
Milton Friedman asked Phil Donahue, where are you going to get these _______ to run your system?
angels
When small amounts of capital investment quickly move a country from poor to wealthy, (The Asian Tigers and China are examples) your textbook calls this the_______ effect
catch-up
A legal maximum on the price at which a good can be sold is called a price
ceiling
According to lecture "The Wisdom of Crowds" supports the idea that groups make good decisions, which supports which of the Ten Principles of Economics?
Markets are a good way to organize economic activity
Which economist dis-proved the Phillips curve?
Milton Friedman
The Federal Reserve Bank is in control of what policies
Monetary
If the government raises government expenditures, then in the short run prices
Multiplier Effect
Images from a satellite of Asia at night indicate which country is the least developed?
North Korea
A market with a few competitors, is called:
Oligopoly
The production possibilities frontier shows the ________ of making cars or computers for a country, or playing basketball or tennis for recreation, or studying or sleeping for students.
Opportunity cost
According to lecture, almost all economics graphs have three elements, from top left to bottom right:
PDQ
According to lecture, the greatest predictor of a country's wealth is:
Policies that Promote Production
The Federal Open Market Committee is made up of the seven Board of Governors and five:
Presidents of the Regional Fed Banks
In a free, competitive market, what is the rationing mechanism?
Price
Prices rise when the government:
Prints too much money
Almost all variation in wealth, from one nation to another, is explained by the variance in:
Productivity
GDP measures the value of the production in a specific interval of time.
Quarter
When we say that economic fluctuations are "irregular and unpredictable," we mean that
Recessions do not occur at regular intervals
According to lecture, the forces that cause movement of the demand curve are _______, and the force that cause the movement of the supply curve are ___________:
SPITE, SITE
According to lecture, Malthus has a ______ view, while Borland has a _________ view of the world.
Scarcity, abundance
In circular flow diagram, GDP can derived from either:
Spending or income
The two words most often used by economists are
Supply and Demand
A tax on an imported good is called a
Tariff
GDP measurements are reported by:
The Bureau of Economic Analysis
Adam Smith's book "The Wealth of Nations" proposed that scarce products get efficiently distributed via:
The Invisible Hand
According to lecture, a rubric for remembering the relationship of floors and ceilings, is:
The ceiling is below the floor
The measure of costs of goods and services bought by a typical customer is:
The consumer price index
The point at which a buyer will buy and the seller will sell is called:
The equilibrium price
Nominal GDP is
The number that is reported, before adjusting for inflation.
When monetary and fiscal policymakers expand aggregate demand, which of the following costs is incurred in the short run?
The price level increases more rapidly
A movement along the supply curve is caused by a change in
The price of a good
According to the public reading in class, the textbook says that 70 years ago, there was concern about the scarcity of what food packaging material
Tin
Physical capital per worker as a predictor of productivity is determined by the use of:
Tools
For a good that is a necessity
demand tends to be inelastic
When the Fed was founded in 1913, it had one mandate: Control inflation. With the Employment Act of 1946, it assumed a second mandate, controlling:
Unemployment
The Supply curve goes:
Up
The "one world" way of towering tariffs with 164 members is:
World Trade Organization
The term hyperinflation refers to
a period of very high inflation
The two causes of economic fluctuations are shifts in:
aggregate demand and aggregate supply
The Fed's goal for inflation is:
2%
In "The Dismal Science? Hardly!" Robert McTeer writes, "It once took 90% of our population to grow food. It now takes:"
3%
Tim Groseclose quotes Cynthia and David Romer when he says the "hump" in the Laffer Curve is at:
33%
The richest 20% of Americans pay what percentage of the total income taxes:
84%
According to lecture, the circular flow model is the same as algebra and accounting because:
Both sides are equal
According to the lecture, Wal-Mart produces how much consumer surplus per family per year?
$2,300
Government spending has caused the current national debt to be greater than:
$21 Trillion
In the business cycle (which we've called the macro model) which of the following move together?
- GDP - Income - Company profits
According to the lecture which of the following were caused by taxes?
- Protestant Reformation - US Revolution - Texas Independence
Which of the following is included in the aggregate demand for goods and services?
- consumption demand - investment demand - net exports
Which of the following would shift the long-run aggregate supply to the right?
- increased immigration from abroad - a decrease in the price of an imported natural resource - opening the economy to international trade
If a price ceiling is imposed on the baby formula market, then
- the quantity of baby formula market, then - the quantity of baby formula supplied will decrease - a shortage of baby formula will develop
How many members are in "The United States of Europe?"
0
Which is the correct order from largest to smallest of the three sources of tax revenue
1. Income 2. Payroll 3. Corporate
Which is the correct order from largest to smallest of the three expenditures of the US federal government
1. Social Security 2. Medicare 3. Defense
The Obama administration claimed a multiplier effect of:
1.6%
In the U.S., each additional year of schooling has historically raised a person's wage on average by about
10%
The US ranks were on the list of Economic Freedom, according to Heritage.org
18th
The annual GDP of the US is:
19.8 Million
According to the lecture, the Consumer Price Index is like the Dow Jones industrial average, because they both compare current prices to:
A historical Baseline
According to lecture, money is:
A means of exchange
Minimum wage is a price floor for labor that produces _______, which is also called __________
A surplus, unemployment
Who said, "The whole of science is nothing more than the refinement of everyday thinking?"
Albert Einstein
Prices cause movement:
Along the Demand and Supply lines
In "The Call" oz Guinness says our audience should be:
An audience of one
Know the Production Possibility Frontier Graph
Book: Chapter 2 pg. 24
Trade among nations is ultimately based on
Comparative Advantage
In the social science iceberg, __________ are on top, and ________ are below the water.
Constructs, Concepts
Total surplus in a market is equal to
Consumer surplus + producer surplus
From the producer's point of view:....... "love your neighbor" is (_______) and "as you love yourself" is: (_______)
Consumer surplus, producer surplus
Macroeconomics studies what level?
Country
"What you give up to get that item" is the definition of opportunity cost. In "The Marshmallow Test," Walter Mischel was testing:
Delayed Gratification
The d-d-d-d-d-d-demand curve goes:
Down
The largest trade bloc is:
EU
____________ refers to the size of the economic pie, and equality refers to how the pie is divided.
Efficiency
The Euro is the currency of:
Eurozone
Who gets richer from trade?
Everyone
Natural resources are necessary for an economy to be highly productive
False
Know Circular Flow Diagram
Flow of Labor/Flow of spending by households
What produces the quantity of goods that maximizes the sum of consumer and the producer surplus?
Free Markets
Growth (in the macro model) is measured by:
GDP
The US earns its lowest score because of poor fiscal policy, in which of the following
Government Size
GDP stands for:
Gross Domestic Product
Know Macro Model
Growth - Inflation Recession - Unemployment Government - Fiscal Fed - Monetary
"People face trade-offs" like students going to class or sleeping in. At the national level, this is typically called the trade-off between:
Guns and Butter
In the video, Don Boudreaux said the amazing increase in human prosperity can be measured as a:
Hockey Stick
To calculate the "net exports" portion of GDP, you subtract imports from export, because:
Imports are not produced in the US
From the box in the textbook, Daron Acemoglu says "Put simply: Fix __________ and you fix poverty."
Incentives
In general, elasticity is a measure of
how much buyers and sellers respond to changes in prices
The GDP deflator, "deflates" _________ when adjusting from nominal to real GDP.
inflation
According to the video, demand side economics tries to affect the economy by increasing government spending and consumption, while supply side flavors:
investment
Stimulus spending moves the aggregate supply curve out, but it moves it back left due to increased interest rates that cause crowding out. What get "crowded out?"
investment spending
The long-run aggregate supply curve
is vertical
The first supplier to leave the market as the price gets lower is called the:
marginal supplier
Willingness to pay
measures the value that a buyer places on a good
When a tax is placed on the sellers of a product, buyers pay
more, and sellers receive less than they did before the tax
According to lecture, as industries concentrate and have fewer suppliers, there is more:
producer surplus
A tax will shift the
supply curve upward by the amount of the tax
Which of the following is not a component of GDP
taxes
Producer surplus is
the amount a seller is paid minus the cost of production
The velocity of money is
the average number of times per year a dollar is spent
The Fed has set a target for:
the interest rate
What quantity is represented by the vertical line on the left graph?
the supply of money
In "The March of Foolish Things" Thomas Sowell says public schools are bad because:
they are not in a competitive market
The study of how the allocation of resources affects economic well-being is called
welfare economics