Economics Unit 5

products that are bought and sold, including food, clothes, computers, and cars

material goods

Countries with the highest gross domestic product (GDP) _____ have the highest GDP per capita. may not always never

may not

the study of individual parts of the economy

microeconomics

when the central bank uses money supply and interest rates to affect a country's economy

monetary policy

amount of money available in the economy, including money in circulation and demand deposits

money supply

During periods of economic growth, an increase in consumption causes companies to make_____ goods and services. the same fewer more

more

When the economy is growing, producers are making _____ goods and services. more fewer

more

total amount of money the federal government owes

national debt

Select all that apply. Select the items that are included in macroeconomics. quantity of couches produced price of cars prices of goods and services used by most people number of people without jobs in the country

prices of goods and services used by most people number of people without jobs in the country

The _____ adds up the market prices of final goods and services. income approach product approach expenditure approach

product approach

the right to exclude others from using the good or service and the right to transfer the ownership or use the resources to others

property right

a duty imposed on imports to raise their price.

protective tariffs

something that can be used by everyone, provides benefits to more than one person at a time, and whose use cannot be restricted to only those people who have paid for it

public good

The U.S. government pays for _____ that producers would most likely not provide in the marketplace, such as building roads. public goods and services borrowing money revenue

public goods and services

person's ability to buy goods and services, given his or her income

purchasing power

Gross Domestic Product adjusted for price changes

real GDP

Gross Domestic Product that is adjusted for price changes is called _____. nominal Gross Domestic Product real Gross Domestic Product inflation

real Gross Domestic Product

money earned from all producers in a country

total income

all goods and services produced by using the factors of production

total output

an agreement between countries to reduce trade barriers

trade-bloc

unemployment that happens when the economy is growing slowly or shrinking

cyclical unemployment

The time from one economic peak to another economic peak (think roller coaster ride) is called the _____. economic cycle Gross Domestic Product net exports

economic cycle

behavioral pattern in the economy that includes growing and shrinking phases

economic cycle

time from one economic peak to another economic peak; behavioral pattern in the economy that includes growing and shrinking phases

economic cycle

During a period of _____, real GDP per capita can increase. economic downturn economic growth population explosion

economic growth

continual rise in a nation's production of goods and services

economic growth

Other standard-of-living measurements besides real GDP per capita may include _____. output of goods and services education producers' profits

education

actions intended to encourage (or expand) economic growth

expansionary policy

The _____ adds up the spending by different parts of the economy, such as consumption, investment, government spending, and net exports. income approach product approach expenditure approach

expenditure approach

Gross Domestic Product (GDP) includes _____. exports, but not imports imports, but not exports exports minus imports

exports minus imports

unintended consequence

externality

Maquiladoras are most similar to American _____. small businesses large corporations agricultural centers factories

factories

end products of the production process

final goods and services

when the government uses government spending and taxes to affect economic performance

fiscal policy

money put into something financial, in hopes of earning more money

investment

Gross Domestic Product includes consumption, net exports, _____, and _____. exports, imports personal income taxes, public goods investments, government expenses

investments, government expenses

putting money into something financial, in hopes of earning more money

investmnet

Which of the following is not an example of how Irish immigrants were eventually accepted in the U.S.? Irish, and people of Irish decent, are allowed to hold public office. Companies in the U.S. outsource jobs to Ireland. Irish immigrants are no longer denied work based on nationality. Irish immigrants, and people of Irish descent are no longer only allowed to live in certain areas of cities.

Companies in the U.S. outsource jobs to Ireland.

The _____ is used to measure price changes in commonly used goods and services, such as food and housing. real inflation hyperinflation Consumer Price Index

Consumer Price Index

a measure of the average change in prices of commonly used goods and services

Consumer Price Index (CPI)

average change in prices of commonly used goods and services

Consumer Price Index (CPI)

_____ occurs with economic downturns in the economic cycle. Frictional unemployment Cyclical unemployment Seasonal unemployment

Cyclical unemployment

According to the United Nations, many countries with very high development are located in _____, and many countries with low development are located in _____. Africa, North America North America, Europe Europe, Africa

Europe, Africa

Monetary policy is carried out by the _____ and involves the money supply and interest rates. president government Federal Reserve

Federal Reserve

GDP divided by the number of people living in a country

GDP per capita

market value, in dollar amounts, of all final goods and services produced within a country's borders

Gross Domestic Product (GDP)

_____ includes the goods and services made in a country, and _____ includes goods and services made from domestically owned factors of production. Gross Domestic Product, Gross National Product Gross National Product, Gross Domestic Product

Gross Domestic Product, Gross National Product

market value, in dollar amounts, of all final goods and services produced by domestically owned factors of production

Gross National Product (GNP)

Select all that apply. Select other ways to measure the quality of life in a country besides the real GDP per capita. Human Development Index Genuine Progress Indicator Gross Domestic Product Index of Social Health

Human Development Index Genuine Progress Indicator Index of Social Health

quality of life measurement that includes a form of GDP per capita, how long people are expected to live, and education

Human Development Index (HDI)

the Islamic State of Iraq and Levant (Syria), a terrorist Sunni Islam sect that seeks to create an all-Sunni country

ISIS

Where are production jobs most likely to be located? Europe Indonesia Japan Canada

Indonesia

Select all that apply. Select the items that describe how business investments can cause economic growth. Investments increase GDP. Investments create more jobs. Investments cause less spending. Investments can lead to more demand for goods.

Investments increase GDP. Investments create more jobs. Investments can lead to more demand for goods.

Select the answer that most accurately describes the effects of NAFTA. Due to the increase of trade and competition, NAFTA has unquestionably benefited all countries involved. Due to the exploitation of labor, NAFTA has been detrimental to Mexico. It is difficult to assess all the results of NAFTA, but most economists agree that NAFTA has been beneficial to the countries involved. It is difficult to assess all the results of NAFTA, but most economists agree that NAFTA has had a negative impact on the countries involved.

It is difficult to assess all the results of NAFTA, but most economists agree that NAFTA has been beneficial to the countries involved.

_____ is the study of the whole economy. Microeconomics Macroeconomics Gross Domestic Product

Macroeconomics

_____ is caused when the Federal Reserve increases the money supply. Monetary inflation Price inflation Fixed income

Monetary inflation

The _____ is the amount of money available in the economy, including the money in your wallet and demand deposits. Inflation Money demand Money supply

Money supply

_____ is an example of a negative externality. Governments intervene in the marketplace to make companies accountable for this kind of unintended consequence. A property right Pollution A public service

Pollution

The largest amount of money the government lays out is for the transfer program, _____. And its largest expenditure is for _____. national defense, education Social Security, national defense interest payments on the national debt, roads

Social Security, national defense

What was Hamilton suggesting of entrepreneurs in his "Report on Manufactures" in 1791? To increase economic productivity by seeking trade agreements. To guard trade secrets and other intellectual property from competitors. To seek to cut costs by lowering wages. To increase economic output by taking ideas from more developed manufacturers

To increase economic output by taking ideas from more developed manufacturers

_____ refers to the percentage of the labor force that is willing and able to work, does not currently have a job, and is actively looking for work. Unemployed Labor force Unemployment rate

Unemployment rate

Economic growth is _____. the GDP's peak, or highest point a continual increase in the GDP the same as the GDP

a continual increase in the GDP

adding things together

aggregate

Total output refers to the goods and services made by _____ producers in a country. some one all

all

An interest rate is the price of money _____ or _____. spent, lent borrowed, saved supplied, loaned out

borrowed, saved

People need to have _____ in the economy to spend money. purchasing power confidence less disposable income

confidence

trust

confidence

buying of final goods and services by households

consumption

actions intended to slow economic growth

contractionary policy

The Federal Reserve _____ the money supply to lower inflation. decreases increases

decreases

When the economy is shrinking, total output is _____ and total income is _____. increasing, decreasing increasing, increasing decreasing, decreasing

decreasing, decreasing

a dispersion of people outside their homeland

diaspora

statements or concepts obtained by inference from causes

generalizations

Fiscal policy is carried out by the _____ and involves spending and taxes. government Federal Reserve U.S. business community

government

Total _____ is the money earned from all producers in a country. sales income quantity

income

The _____ adds up the money earned by producers plus taxes paid to the government. income approach product approach expenditure approach

income approach

Expansionary policies are intended to _____ economic growth, and contractionary policies are intended to _____ economic growth. increase, increase decrease, increase increase, decrease

increase, decrease

Inflation is a(n) _____ in the prices of many goods and services, which _____ purchasing power. increase, decreases increase, increases decrease, decreases

increase, decreases

Economic growth can result from a(n) _____ in government expenditures and a(n) _____ in net exports. increase, increase decrease, decrease increase, decrease

increase, increase

By having antitrust laws, the government _____ in the marketplace. increases competition provides public goods offers safer products

increases competition

When the Federal Reserve _____ the money supply, it also _____ interest rates. increases, lowers decreases, lowers does not change, raises

increases, lowers

When the economy is growing, total output is _____ and total income is _____. increasing, decreasing increasing, increasing decreasing, decreasing

increasing, increasing

increase in the prices of commonly used goods and services

inflation

creations of the mind, such as inventions and literary and artistic works

intellectual property

price of money that is borrowed or saved

interest rate

people 16 or older who are actively seeking work

labor force

output of goods and services divided by the number of workers used to produce the output

labor productivity

the study of the whole economy

macroeconomics

manufacturing operations in Mexico where certain materials are duty- and tariff-free

maquiladoras

he federal government spends most of its money on _____, lays out the most money for the transfer program _____, and receives a large part of its revenue from _____. national defense, Social Security, personal incomes taxes interest from the national debt, payroll taxes, education the national debt, education, public goods

national defense, Social Security, personal incomes taxes

One of the problems with using real GDP per capita to determine the quality of life is that it does not fully account for _____. negative externalities consumption of material goods business investments

negative externalities

The Smoot Hawley Tariff _____. successfully improved sales of American goods. positively influenced foreign trade. kept all goods from foreign markets out of the United States negatively affected American industry

negatively affected American industry

exports minus imports

net exports

Gross Domestic Product in current dollars

nominal GDP

Part of the _____ is an economic downturn, which causes _____. GDP growth, inflation economic cycle, cyclical unemployment Federal Reserve, interest rates

not GDP

Brian has given up looking for a job. He has searched for more than a year and does not believe that a job for him exists. He is _____ in the unemployment rate. counted not counted

not counted

Real GDP per capita for the United States is calculated by dividing real GDP by the _____. number of people living in one state number of producers in the country number of people living in the country

not one state

_____ are sources of revenue for both federal and state governments. Individuals pay this tax from the money they earn. Property taxes Sales taxes Personal income taxes

not property taxes

Shoes made in an American-owned factory located in Mexico are part of _____. only the Gross Domestic Product only the Gross National Product both the Gross Domestic Product and the Gross National Product

only the Gross National Product

tax paid by individuals on money they earn

personal income tax

If you borrowed $5,000 for four years, that would be a _________________. short-term loan long-term loan critical loan interest-based loan

short-term loan

the authority of a state to govern itself

sovereignty

Real GDP per capita is the most popular way to measure _____. changes in prices standard of living changes in population

standard of living

comfort level that people experience from having goods and services available to them

standard of lving

Examining the real GDP per capita in different countries allows economists to compare _____ in different parts of the world. levels of education health care coverage standards of living

standards of living

Select all that apply. Select examples of unpaid work that are not included in the real GDP per capita. working in a clothing store taking care of your parents washing dishes doing laundry

taking care of your parents washing dishes doing laundry

number of working-age people who do not have jobs

unemployment

The government provides _____ to people out of work who are actively looking for new jobs. unemployment insurance frictional unemployment labor benefits

unemployment insurance

money that the government gives to unemployed people who meet certain requirements

unemployment insurance

percentage of the labor force that is willing and able to work, does not currently have a job, and is actively looking for work

unemployment rate