Economics Final

Ryan's income is $1,700 and his net taxes are $700. His disposable income is

$1,000

Refer to Table 9.1. At an output level of $1,200 billion, the level of aggregate expenditure is

$1,400 billion.

Violet's income is $3,200 a month. She deposits $600 in a saving account, buys $700 worth of government securities, and leaves the rest for daily transactions. Violet's money demand is

$1,900

Refer to Table 10.1. The required reserve ratio is 10%. If the First Charter Bank is meeting its reserve requirement and has no excess reserves, its reserves equal

$120

Refer to Table 8.4. At an aggregate output level of $2,000 million, planned expenditure equals

$2,200

Refer to Table 6.1. Personal consumption expenditures in billions of dollars are

$2300

Refer to Table 8.3. At an aggregate output level of $200 billion, planned expenditure equals

$260 Billion

If an economy produced 10 pizzas at $20 each and fifteen gallons of root beer at $5 each, the total value of these goods and services would be

$275

The Slippery Slope Company manufactures only snow skis. In 2010 Slippery Slope manufactured 10,000 snow skis, but sold 12,000 snow skis. In 2010 Slippery Slope's change in inventory was ________ snow skis.

-2,000

If the MPS is 0.10, MPC is

.90

Refer to Table 10.2. The required reserve ratio is

20%

Refer to Table 10.3. The required reserve ratio is

25%

Refer to Figure 11.4. There is an excess demand for money of $400 billion at an interest rate of

3%

Refer to Table 6.1. The value for gross private domestic investment in billions of dollars is

510

Refer to Table 7.2. The total number of people unemployed is

6 million

Refer to Figure 11.2. A decrease in the interest rate could be represented by a movement from Point ________ to Point ________.

A; C

Refer to Figure 11.2. An increase in nominal aggregate output could be represented by a movement from Point ________ to Point ________.

A;B

Which of the following sequence of events follows a contractionary fiscal policy?

AE↓ ⇒ Y↓ ⇒ Md↓ ⇒ r↓ ⇒ I↑ ⇒ AE↑

Refer to Figure 8.1. The ________ for this household is 0.5 and the ________ is also 0.5

MPC;MPS

Refer to Figure 8.7. In Spiceland, income does not vary with planned investment. Spiceland's planned investment function is represented by

Panel C

For Joanna to be considered out of the labor force, she can be

a full-time student

Refer to Figure 8.8. [150 + 0.25Y] is the

aggregate expenditures function.

Which of the following decreases the real interest rate?

an increase in the inflation rate, holding the nominal interest rate constant

In 2010, the city of Springfield collected $375,000 in taxes and spent $450,000. In 2010, the city of Springfield had a

budget deficit of $75,000.

In 2010, the city of Sylvester collected $800,000 in taxes and spent $200,000. In 2010, the city of Sylvester had a

budget surplus of $600,000.

The quantity of output supplied at ________ is represented by the aggregate supply curve.

different price levels

In order for a barter transaction to be successful, there must be a

double coincidence of wants.

Annabel retired from the fire department. She started working an hour or two a day at a paid job in the local hospital. Annabel is

employed

The employment rate equals

employed/labor force

When the interest rate falls, bond values

rise

Macroeconomics

studies the behavior of the economy as a whole.

The change in consumption divided by the change in income is equal to

the MPC.

The two links between ________ and ________ are the interest rate and the unemployment rate

the goods market, the money market

The interest rate paid on bonds decreases from 6% to 2%. This will cause

the optimal balance to increase because it lowers the opportunity costs of holding money.

Refer to Figure 9.4. The value of Point B is

the same as the value of Point A

Refer to Figure 9.4. The value of Point A is

the same as the value of Point B

If actual investment exceeds planned investment

there will be an accumulation of inventories.

Hyperinflation refers to a(n)

very rapid increase in the overall price level

A bond with a face value of $5,000

will sell for the market determined price.

Refer to Figure 9.4. Along aggregate expenditure AE1, the MPS will be

0.2

Refer to Figure 8.9. [200 + 0.8Y] represents the

aggregate expenditures function.

Refer to Table 9.3. Assuming constant MPC, at income of $1,300 million, saving is $________million, at income of $1,500 million, saving is $________ million.

180; 220

Refer to Table 10.2. First Commercial Bank's total loans equal $________.

2,500,000

Which of the following serves as the central bank of the United States?

The Federal Reserve System

Refer to Table 12.1. If the interest rate dropped from 15% to 6%, planned investment would ________ by $________ billion.

increase; 90

To determine the price level and aggregate output, the aggregate demand and aggregate supply must

intersect

Because money eliminates the "double coincidence of wants" problem, the development of money as a ________ has facilitated the expansion of trade.

medium of exchange

Refer to Figure 13.4. Between the output levels of $600 billion and $900 billion, the relationship between the price level and output is

positive

Refer to Figure 8.9. There is a $100 million unplanned decrease in inventories at an aggregate output level of

$500 million

Cold Creek Credit Union has liabilities of $450,000 and net worth of $175,000. Cold Creek Credit Union's assets are

$625,000

Refer to Table 10.2. First Commercial Bank's excess reserves equal $________.

1,200,000

Refer to Table 9.3. The equilibrium level of aggregate income is $________ million.

1,400

If 5 million workers are unemployed and 45 million workers are employed, then the unemployment rate is

10%

Refer to Table 10.3. People's Bank excess reserves are $________.

100,000

Refer to Table 10.3. The net worth of People's Bank is $________.

100,000

The Bob & Weave Company manufactures only hair extensions. In 2010 Bob & Weave manufactured 50,000 hair extensions, but sold only 32,000 hair extensions. In 2010 Bob & Weave's change in inventory was ________ hair extensions.

18,000

Refer to Table 10.3. Total loans of People's Bank equal $________.

300,000

) If the labor force is 400 and employment is 380, then the unemployment rate is

5%

If Earl received an $800 bonus and his MPS is 0.25, his consumption rises by $________ and his saving rises by $________.

600;200

Refer to Table 9.3. Assuming constant MPC, at income of $1,100 million, consumption is $________million, and at income of $1,400 million, consumption is $________ million.

760;1,000

Refer to Figure 11.4. There is an excess supply of money of $400 billion at an interest rate of

8%

John's optimal money balance has decreased. This could have been caused by

an increase in the interest rate

Refer to Table 7.2. The labor force

equals 120 million

If planned investment ________ when the interest rate ________, there will be a crowding-out effect.

falls; rises

Sylvia, a writer for a newspaper, interviewed top managers at 50 large corporations. All of the managers indicated that the primary determinant of planned investment is the interest rate and not the expected sales. From this information, Sylvia concluded that

fiscal policy would not be very effective, but monetary policy would be very effective.

The value of all final goods and services produced during a given time period measures a nation's

gross domestic product

Refer to Figure 11.5. The interest rate will ________ if the money supply decreases from MS1 to MS0 .

increase from 4% to 6%

Refer to Table 9.2. At an output level of $1,500 billion, there is an unplanned inventory

increase of $200 billion

Refer to Figure 11.5. Assume the interest rate equals 4% and the money supply decreases from Ms1to Ms0. There will be an excess demand for money of 200 if the interest rate

remains at 4%

"Final goods and services" are those that are

sold to the ultimate or final purchasers.