Unit 4 Test (100%)
____ believed the best way to reverse an economic downturn was to increase government spending.
John Maynard Keynes
Who has the absolute advantage in selling salads?
Mike
About how many smartphones can China manufacture if they build 550 cargo ships?
about 15 million
A(n) _____ advantage is held by the economy that produces the highest total number of items.
absolute
switching from a soft drink to tap water
commodity substitution effect
Which answer is NOT a stage of the business cycle?
consolidation
The _____ theory blames a rise in inflation on a rise in wage rates and the price of natural resources.
cost-push
Ben and Jerry's lays off 500 workers during a recession, creating _____ unemployment.
cyclical
replacing a DVD player with a device that can stream videos
new goods effect
going online to a discount website to purchase old CDs
outlet substitution effect
going to an outlet store for a new suit
outlet substitution effect
A(n) ____ good is something provided by the government that may be used by many citizens at the same time without reducing the benefit.
public
recognizing the difference between a 2001 cell phone and a 2009 smartphone
quality change effect
David Hume's ______ theory states that too much money in circulation leads to inflation.
quantity
In the circular flow model, the resource market sends ___ to the government.
resources
A carpenter who loses work during the winter every year experiences _____ unemployment.
seasonal
Government mismanagement of the economy is the cause of _____ inflation.
structural
A protective ______ is used in an attempt to protect a country's businesses.
tariff
In the circular flow model, businesses send ___ to the government.
taxes
Calculate the CPI for the current year.
$168.92
What was California's GDP in 2010 in millions?
$5,810.2
What is the total of the current year CPI market basket?
$50.00
Who has the comparative advantage in selling pastries?
Susan
______ is the moving of services or production to another country in order to save money.
Offshoring
___ states that real GDP will decline 2% for every 1% increase in unemployment.
Okun's Law
______ is a dangerous economic condition whereby inflation and unemployment rise at the same time.
Stagflation
A(n) ______ might be used to prevent unhealthy products from entering a country.
embargo
In the circular flow model, households send ___ to the product market.
expenditures
A rental car company buys 30 new automobiles. The automobiles are examples of ___ goods.
final
You buy a brand-new television. The television is an example of a(n) ___ good.
final
An employee who leaves a job to be closer to home experiences ______ unemployment.
frictional
A deli buys 40 pounds of salami for its famous grinder sandwiches. The salami is an example of ___ goods.
intermediate
A ship-building company buys 50 tons of lumber to build classic-style ships. The lumber is an example of ___ goods.
intermediate
