ECO/372T: Principles of Macroeconomics

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ECO/372T Week 1 Measuring Output & Income
ECO/372t Week 1 Discussion Nominal GDP
ECO/372T Week 1 Apply Measuring Output & Income
ECO/372T Week 1 Apply Measuring Output & Income

ECO/372T Week 1

 

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Apply: Measuring Output and Income Quiz

Includes Questions and Answers, plus additional questions/answers - A+ Work!

  1. Suppose a small economy produces only smart TVs. In year one, 100,00 TVs are produced and sold at a price of $1,200 each. In year two, 75,00 TVS are produced and sold at a price of $1,200. As a result,
  2. What do economists mean when they refer to inflation as “general increase in the prices of goods and services.”
  3. Which of the following scenarios would be considered an investment according to economists?
  4. Real GDP refers to
  5. Nominal GDP is the market value of
  6. Suppose that real GDP per capita in the United States is $49,000. If the long-term growth rate of real GDP per capita is 1.6% per year, how many years will it take for real GDP per capita to reach $98,000?
  7. Which of the following is an example of an intermediate good?
  8. One could argue that GDP is not a good measure of the standard of living in a nation because it _____.
  9. The service a homeowner performs when she mows her yard is not included in GDP because _____.
  10. The nominal GDP in Liplandis is currently $3,456 billion. If net foreign factor income increases by $400 billion, the nominal GDP will _____.
  11. What can we conclude if depreciation (consumption of fixed capital) exceeds gross domestic investment?
  12. Which of the following measures is most often used to compare the standards of living in different countries?
  13. Which of the following answer choices best describes a consumption expenditure category in the national income accounting?
  14. The expenditures or output approach to GDP measures it by summing up _____.
  15. The following is national income account data for a hypothetical economy in billions of dollars: gross private domestic investment ($320), imports ($35), exports ($22), personal consumption expenditures ($2,460), and government purchases ($470). What is GDP in this economy?
  16. A nation's gross domestic product (GDP) _____.
  17. When gross investment is positive, net investment _____.
  18. Which of the following underground economy activities would be considered a black market?
  19. The consumption of fixed capital in each year's production is called _____.
  20. GDP does not include which of the following activities?
  21. Which of the following is an example of net exports?
  22. If gross investment for a year was $120 billion and net investment was $65 billion, then in that year the country's capital stock _____.
  23. Nominal GDP is the market value of _____.
  24. To avoid multiple counting in national income accounts, _____.
  25. What are net exports?
  26. When are net exports negative?
  27. Suppose that GDP was $200 billion in year 1 and that all other components of expenditures remained the same in year 2, except that business inventories increased by $10 billion. GDP in year 2 is _____.
  28. All else equal, increases in proprietors' income will _____.
  29. The GDP price index measures changes in the _____.
  30. Which of the following is not included in the sum of national income?
  31. Currently, the largest component of aggregate spending in the United States is _____.
  32. GDP understates the amount of economic production in the United States because it excludes _____.
  33. Which one of the following is not an example of final goods in national income accounting?
  34. If output increases by 8% from year 5 to year 6, then in that period _____.
  35. When local police and fire departments buy new cars for their operations, these are counted as part of _____.
  36. Which of the following is not an example of an intermediate good?
  37. Consumption of fixed capital (depreciation) can be determined by _____.
  38. Gross domestic product in this economy is _____.
  39. Arthur sells $100 worth of cotton to Bob. Bob turns the cotton into cloth, which he sells to
  40. Camille for $300. Camille uses the cloth to make prom dresses that she sells to Donita for
  41. $900. Donita sells the dresses for $1,500 to kids attending the prom. The total contribution to GDP of this series of transactions is
  42. Refer to the accompanying data (all figures in billions of dollars). GDP is
  43. Suppose a family's income increases by 3 percent at the same time that inflation is 5
  44. percent. Then the
  45. Refer to the graphs. Which of the following best represents a negative demand shock when prices are inflexible?
  46. If in some year gross investment was $240 billion and net investment was $130 billion, then in that year the country's capital stock
  47. If real GDP in a year was $3,900 billion and the price index was 130, then nominal GDP in that year was approximately
  48. Suppose that GDP was $300 billion in year 1 and that all other components of expenditures
  49. remained the same in year 2 except that business inventories increased by $15 billion. GDP in year 2 is

Practice Homework: Measuring Output and Income

Includes Questions and Answers - A+ Work!

  1. Before the Industrial Revolution, living standards in the world
  2. The "rule of 72" is a formula for determining the approximate number of
  3. If an economy maintains a small rate of growth for a long period of time, then the size of the economy
  4. What is the largest expenditure component of GDP?
  5. Government purchases include spending on
  6. The consumption of fixed capital in each year’s production is called
  7. What are net exports?
  8. The expenditures or output approach to GDP measures it by summing up
  9. GDP measured using current prices is called
  10. GDP measured using base year prices is called
  11. The growth of GDP may understate changes in the economy's economic well-being over time if the
  12. Money spent on the purchase of a newly constructed house is included in GDP as a part of
  13. Nominal GDP differs from real GDP because
  14. If real GDP declines in a given year, nominal GDP
  15. Refer to the table. Between years 1 and 2, real GDP grew by __________ percent in Alta

Discussion - Nominal GDP

Includes 2 Answers to Discussion Question

GDP is a strong measure of the health of the economy, and it’s among the most important and widely reported economic data.

  • In your own words, summarize nominal GDP.
  • Locate an online news article that discusses impacts to GDP in some way. Summarize the article and explain its relation to/impact on GDP.
  • Cite your sources.

 

 

 

 

ECO/372T Week 2 Apply Summative Assessment: Business Cycles, Unemployment, and Inflation
ECO/372T Week 2 Apply Summative Assessment: Business Cycles, Unemployment, and Inflation
ECO/372T Week 2 Apply Summative Assessment: Business Cycles, Unemployment, and Inflation
ECO/372T Week 2 Apply Summative Assessment: Business Cycles, Unemployment, and Inflation

ECO/372T Week 2

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Apply: Summative Assessment: Business Cycles, Unemployment, and Inflation Quiz

ncludes Questions and Answers, plus additional questions/answers - A+ Work!

  1. The industries or sectors of the economy in which business cycle fluctuations
  2. tend to affect output most are
  3. In which phase of the business cycle will the economy most likely experience
  4. rising real output and falling unemployment rates?
  5. What do economists mean when they refer to inflation as “general increase in
  6. the prices of goods and services
  7. The annual inflation rate measures the percentage growth rate of
  8. If the Consumer Price Index was 125 in one year and 120 in the following
  9. year, then the rate of inflation is approximately
  10. The best example of a "frictionally unemployed" worker is one who
  11. Which of the following statistics can turn negative?
  12. The rate of unemployment when the economy is fully employed is called the
  13. According to the Bureau of Labor Statistics, to be officially unemployed a person must
  14. Using this information, which of the following statements is correct regarding these two short recessions?
  15. Historical data show that during the recession of 1990-1991, the natural rate of unemployment was about 5.9% while the actual unemployment rate was 7.0%. A decade later, during the 2001 recession, the natural rate of unemployment fell to 4.8% while actual unemployment was 6.0%. Using this information, which of the following statements is correct regarding these two short recessions
  16. The following information is given for an economy. Labor Force of an Economy Table. How much of the population is older than 16? What is the size of the labor force? What is the labor force participation rate?
  17. Using the graph below, identify the different stages of the business cycle. Assume A, B, and C represent consecutive years.
  18. Inflation is a general increase in the prices of all goods and services. When inflation occurs people
  19. When inflation occurs
  20. If the CPI declines from one year to the next, then which one of the following statements is not true?
  21. Suppose there are 10 million part-time workers and 90 million full-time workers in an economy. Five million of the part-time workers switch to fulltime work. As a result
  22. Official unemployment rate statistics may
  23. Unexpected inflation arbitrarily:
  24. Which of the following groups has traditionally benefited from unexpected inflation?
  25. Inflation that occurs when total spending is greater than the economy’s ability to produce output at the existing price level is:
  26. Which of the following measures the changes in the prices of a “market basket” of some 300 goods and services purchased by typical urban consumers?
  27. The inflation rate measures the percentage growth rate of:
  28. What is an advantage of mild inflation according to some economists?
  29. The CPI compiled by the Bureau of Labor Statistics is used in the computations for the:
  30. Core inflation refers to the inflation picture after stripping away the:
  31. What is the main problem with mild inflation according to some economists?
  32. Assume that there is a fixed rate of interest on contracts for borrowers and lenders. If unexpected inflation occurs in the economy, then:
  33. Inflation is a rise in:
  34. In an economy, the total expenditures for a market basket of goods in year 1 (the base year) was $5,000 billion, in year 2, the total expenditure for the same market basket of goods was $5,500 billion. What was the Consumer Price Index for the economy in year 2?
  35. Inflation caused by an increase in aggregate spending is referred to as:
  36. Inflation caused by a rise in the prices of inputs is referred to as
  37. Use the table below to answer the next question.
  38. Determine the number of people frictionally unemployed for the year 2006.
  39. The natural rate of unemployment:
  40. In calculating the unemployment rate, part-time workers are:
  41. A recession is a decline in
  42. Use the following diagram to answer the next question.
  43. The straight line E drawn through the wavy lines would provide an estimate of the
  44. The labor force includes:
  45. In the United States, business cycles have occurred against a backdrop of a long-run trend of:
  46. In calculating the unemployment rate, ‘discouraged’ workers who are not actively seeking employment are
  47. Unemployment that occurs when there is deficient demand for the goods and services of an economy is called
  48. A mismatch between the geographic location of workers and the location of job openings would results in which type of unemployment?
  49. Search and wait unemployment is another way to describe:
  50. The unemployed are those people who:
  51. The unemployment rate is interpreted as the percentage of the
  52. The recurrent ups and downs in the level of economic activity extending over several years are referred to as:
  53. In the expansion phase of a business cycle:
  54. Which of the following groups declares the start and end of recessions in the U.S.?
  55. The rate of unemployment when the economy is fully employed is called the
  56. Which of the following is the correct way to calculate the unemployment rate?
  57. Use the following diagram to answer the next question. The diagram illustrates the pattern of:
  58. According to the Bureau of Labor Statistics, to be officially unemployed a person must
  59. ‘Full employment’ refers to the situation when there is
  60. Use the table below to answer the next question. Determine the number of people structurally unemployed for the year 2005.
  61. The GDP gap measures the amount by which
  62. A trough in the business cycle occurs when:
  63. Wait unemployment and search unemployment are both types of
  64. Which of the following statements is true about causes of business cycle fluctuations? b. Derek worked for a large telecommunication firm that went bankrupt last year due to a recent recession. He has since tried to find work with one of the firm’s competitors, but good jobs are currently hard to come by c. Drew lost his job at a car manufacturer last year. He spent 6 months applying for every job possible before giving up 2 months ago. He now spends his day playing Xbox. d.Paula has 20 years of experience in manufacturing. Her employer, and many other manufacturing firms, recently closed their U.S. plants. She would like to find a similar job but is unable to find anything that utilizes her skills. e. Katherine works part-time at a small retail store. She would like to work full-time, but the employer is currently unable to extend the hours. f. Tyrell just graduated from college with a business degree. He is currently looking for a job in banking in the major city he just moved to. g. Mike is a contractor who has been unable to find work, since most businesses are delaying or canceling their construction plans due to economic uncertainty in the coming year. h. Meg used to own and run her own bookstore. Her sales declined due to competition from online retailers. She has not been able to find any work related to her skills in the diminishing industry for books.
  65. In each of the following examples, identify whether the person is counted in the official labor force or not. a. Cynthia owns and operates her own retail store. b. Elder has recently moved to a retirement community in Florida where he enjoys his ‘golden years’ as a retiree. c. Drew lost his job at the bank last year. He spent 6 months applying for every job possible before giving up 2 months ago. d. Katherine works part-time at a small retail store. She would like to work full-time, but her employer is unable to extend her hours. e. Latisha is an ambitious 15-year-old who spends her summer working as a lifeguard at the local pool. f. Bill is currently serving a prison sentence, and works making license plates. g. Tyrell just graduated college with a business degree. He is currently looking for a banking job in the major city he just moved to. h. John and his wife just had their second child. They decided it was best for John to leave his job and care for their new child.
  66. Suppose Marcus eats nothing but burritos for dinner. He buys 30 burritos each month. During the last couple of weeks, Marcus noticed an increase in the price of burritos. The price of burritos rose from $5.50 per burrito last month to $6.60 per burrito this month. Assume that Marcus has a fixed income of $165 that he can spend on burritos.
  67. For each of the following items, indicate to which major group of the CPI the item belongs:
  68. Historical data show that during the recession of 1990-1991, the natural rate of unemployment was about 5.9% while the actual unemployment rate was 7.0%. A decade later, during the 2001 recession, the natural rate of unemployment fell to 4.8% while actual unemployment was 6.0%
  69. Using this information, which of the following statements is correct regarding these two short recessions?
  70. Using the graph below, identify the different stages of the business cycle. Assume A, B, and C represent consecutive years.
  71. Which of the following is a group used to compute the consumer price index?
  72. The CPI is computed by the U.S. Bureau of Labor Statistics through interviews and weekly diaries for more than 10,000 families around the country.
  73. Calculate Andy’s weekly cost in each of the three years. To the nearest whole number, the value of CPI in Year 2 is ________. (Round off your answer to the nearest whole number.) The value of the CPI in Year 1 is _________. (Please add whole numbers as your answer)

 

 

Practice Homework: Business Cycles, Unemployment, and Inflation Quiz

Includes Questions and Answers, all practice quizzes combined - A+ Work!

  1. The recurrent ups and downs in the level of economic activity extending over several years are referred to as
  2. The unemployment rate is interpreted as the percentage of the
  3. The labor force includes
  4. Alex works in his own home as a homemaker and full-time caretaker of his children. Officially, he is
  5. The natural rate of unemployment
  6. New college graduates still looking for their first jobs would be classified in the BLS data as
  7. Inflation is a rise in
  8. Which phase of the business cycle would be most closely associated with an economic contraction?
  9. Which of the following m
  10. asures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
  11. A recession is a decline in
  12. The goods and services used to calculate the consumer price index represent
  13. Ahmed bought the same goods and services this year as last year. But, he has experienced inflation. This means
  14. Suppose there are 5 million unemployed workers seeking jobs. After a period of time, 1 million of them become discouraged over their job prospects and cease to look for work. As a result of this, all else equal, the official unemployment rate would
  15. Which of the following statistics can turn negative?
  16. The recurrent ups and downs in the level of economic activity extending over several years are referred to as
  17. The unemployment rate is interpreted as the percentage of the labor force
  18. The labor force includes employed workers and persons who are officially
  19. Alex works in his own home as a homemaker and full-time caretaker of his children. Officially, he is
  20. The natural rate of unemployment is equal to the total of
  21. New college graduates still looking for their first jobs would be classified in the BLS data as
  22. Inflation is a rise in
  23. Which phase of the business cycle would be most closely associated with an economic contraction?
  24. Which of the following measures the changes in the prices of a "market
  25. basket" of some 300 goods and services purchased by typical urban consumers?
  26. A recession is a decline in
  27. The goods and services used to calculate the consumer price index represent
  28. Ahmed bought the same goods and services this year as last year. But, he has experienced inflation. This means
  29. Suppose there are 5 million unemployed workers seeking jobs. After a period of time, 1 million of them become discouraged over their job prospects and cease to look for work. As a result of this, all else equal, the official unemployment rate would
  30. Which of the following statistics can turn negative?
  31. Using the graph below, identify the different stages of the business cycle. Assume that A, B, and C represent consecutive years. a. A time period when the economy is growing toward full employment is known as __________. It is depicted in the graph as, _________ . b. A time period characterized by full or near-full employment is known as ________. It is depicted in the graph as _________. c. A time period with two consecutive quarters of declining output is known as _________. It is depicted in the graph as __________. d. A time period when employment and real output are at their lowest levels is known as ___________. It is depicted in the graph as _______.
  32. In each of the following examples, identify whether the individual is experiencing cyclical unemployment, frictional unemployment, structural unemployment, or no unemployment. a. Eduardo has recently moved to a new city with his wife who was offered a great job there. He is trying to find a position in the same industry he worked in before relocating. b. Derek worked for a large telecommunications firm that went bankrupt last year due to a recent recession. He has since tried to find work with one of the firm's competitors, but good jobs are currently hard to come by.
    c. Drew lost his job at a car manufacturer last year. He spent 6 months applying for every job possible before giving up 2 months ago. He now spends his day playing Xbox. d. Paula has 20 years of experience in manufacturing. Her employer, and many other manufacturing firms, recently closed their U.S. plants. She would like to find a similar job but is unable to find anything that utilizes her skills. e. Katherine works part-time at a small retail store. She would like to work full-time, but her employer is currently unable to extend her hours. f. Tyrell just graduated from college with a business degree. He is currently looking for a job in banking in the major city he just moved to. g. Mike is a contractor who has been unable to find work, since most businesses are delaying or canceling their construction plans due to economic uncertainty in the coming year. h. Meg used to own and run her own bookstore. Her sales declined due to competition from online retailers. She has not been able to find any work related to her skills in the diminishing retail industry for books.
  33. Suppose Marcus eats nothing but burritos for dinner. He buys 30 burritos each month. During the last couple of weeks, Marcus noticed an increase in the price of burritos. The price of burritos rose from $5.50 per burrito last month to $6.60 per burrito this month. Assume that Marcus has a
    fixed income of $165 that he can spend on burritos. How many burritos can Marcus afford to buy at the new price of $6.60?
  34. Historical data show that during the recession of 1990–1991, the natural rate of unemployment was about 5.9% while the actual unemployment rate was 7.0%. A decade later, during the 2001 recession, the natural rate of unemployment fell to 4.8% while actual unemployment was 6.0%.
    Using this information, which of the following statements is correct regarding these two short recessions?
  35. In each of the following examples, identify whether the person is counted in the official labor force or not. a. Cynthia owns and operates her own retail store. b. Elder has recently moved to a retirement community in Florida where he enjoys his "golden years" as a retiree. c. Drew lost his job at the bank last year. He spent 6 months applying for every job possible before giving up 2 months ago. d. Katherine works part-time at a small retail store. She would like to work full-time, but her employer is unable to extend her hours e. Latisha is an ambitious 15-year-old who spends her summer working as a lifeguard at a local pool. f. Bill is currently serving a prison sentence, and works making license plates. g. Tyrell just graduated college with a business degree. He is currently looking for a banking job in the major city he just moved to. h. John and his wife just had their second child. They decided that it was best for John to leave his job and care for their new child.
  36. For each of the following items, indicate to which major group of the CPI the item belongs: a. Tuition payments to your university. b. A new desk for your dorm room or apartment. c. An airline ticket to Florida to be used during spring break. d. A 12-pack of beer to be used during spring break. e. Tickets to a local concert. f. A late night visit to the emergency room
  37. Which of the following statements is true about causes of business cycle fluctuations?
  38. Which of the following is the correct way to calculate the unemployment rate?
  39. Wait unemployment and search unemployment are both types of
  40. According to the Bureau of Labor Statistics, to be officially unemployed a person must
  41. The GDP gap measures the amount by which
  42. The Great Recession that started in 2007 was triggered by shocks in which of the following economic sectors?
  43. A trough in the business cycle occurs when
  44. A mismatch between the geographic location of workers and the location of job openings would
  45. result in which type of unemployment?
  46. The unemployed are those people who
  47. The unemployment rate of full-employment is also called the
  48. In calculating the unemployment rate, part-time workers are
  49. Use the table below to answer the next question. Determine the number of people cyclically unemployed for the year 2004. Determine the number of people frictionally unemployed for the year 2006. Determine the number of people structurally unemployed for the year 2005.
  50. The labor force includes
  51. The rate of unemployment when the economy is fully employed is called the
  52. Determine the number of people frictionally unemployed for the year 2006.
  53. Unemployment that occurs when there is deficient demand for the goods and services of an economy is called
    Use the following diagram to answer the next question. a. The diagram illustrates the pattern of: _________. b. The straight line E drawn through the wavy lines would provide an estimate of the__________.
  54. The recurrent ups and downs in the level of economic activity extending over several years are
    referred to as
  55. A recession is a decline in
  56. Which of the following groups declares the start and end of recessions in the U.S.?
  57. In calculating the unemployment rate, "discouraged" workers who are not actively seeking
    employment are Use the following diagram to answer the next question (graph #27). The diagram illustrates the pattern of
  58. "Full employment" refers to the situation when there is
  59. In the United States, business cycles have occurred against a backdrop of a long-run trend of -
  60. A peak in the business cycle
  61. Use the table below to answer the next question (table #22). Determine the number of people structurally unemployed for the year 2005.
  62. The inflation rate measures the percentage growth rate of
  63. Inflation caused by an increase in aggregate spending is referred to as
  64. Unexpected inflation arbitrarily
  65. The CPI compiled by the Bureau of Labor Statistics is used for computing Inflation that occurs when total spending is greater than the economy's ability to produce output at the existing price level is
  66. In an economy, the total expenditures for a market basket of goods in year 1 (the base year) was $5,000 billion. In year 2, the total expenditure for the same market basket of goods was $5,500 billion. What was the Consumer Price Index for the economy in year 2?
  67. What is an advantage of mild inflation according to some economists?
  68. Which of the following measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
  69. Inflation caused by a rise in the prices of inputs is referred to as
  70. Core inflation refers to the inflation picture after stripping away the
  71. Assume that there is a fixed rate of interest on contracts for borrowers and lenders. If unexpected inflation occurs in the economy, then
  72. Which of the following groups has traditionally benefited from unexpected inflation?
  73. What is the main problem with mild inflation according to some economists?
  74. Inflation is a rise in

Discussion - Business Cycles

The business cycle represents the short-term changes experienced in the economy due to changes in levels of economic activity. 

  • Summarize the 4 different phases of the business cycle. 
  • Offer real-life events that you’ve experienced or researched, as examples for 1 to 2 phases of your choice.
  • Share the impact that you, your company, or others around you experienced.
  • Based on that impact, what corrective action(s) should be taken? 

 

ECO/372T Week 3 Apply Summative Assessment Public Finance & Aggregate Demand and Supply
ECO/372T Week 3 Apply Summative Assessment Public Finance & Aggregate Demand and Supply
ECO/372T Week 3 Discussion Aggregate Demance

ECO/372T Week 3

Everything listed for Week 2 is included in purchase!! 

 

ECO/372T Week 3 Tutorials Kit includes:

 

 

Apply: Summative Assessment: Public Finance & Aggregate Demand & Supply Quiz

Includes Questions and Answers, plus additional questions/answers - A+ Work!

  1. The aggregate demand curve or schedule shows the relationship between the total demand for output and the
  2. Which combination of factors would most likely increase aggregate demand?
  3. Changes in the national incomes of our trading partners would directly affect our
  4. The short-run aggregate supply curve shows the
  5. Which line represents the long-run aggregate supply curve?
  6. Use the following graph to answer the next question. If aggregate demand curve shifts from AD2 to AD1, the effect on real GDP will be a decrease from
  7. If aggregate demand increases and aggregate supply decreases, the price level
  8. Use the following diagrams for the U.S. economy to answer the next question. Which of the diagrams best portrays the effects of a substantial reduction in government spending?
  9. Use the following diagrams for the U.S. economy to answer the next question. Assuming the economy is initially at full employment, which of the diagrams best portrays a recession?
  10. Most economists believe that property taxes are regressive. How is the public debt calculated?
  11. A decrease in expected returns on investment will most likely shift the AD curve to the _____.
  12. The aggregate demand curve or schedule shows the relationship between the total demand for output and the _____.
  13. An aggregate supply curve represents the relationship between the _____.
  14. In which of the following sets of circumstances can we confidently expect inflation?
  15. The table below shows labor income for four individuals and the amount each has paid in income taxes. Labor Income, Tax Paid, and Average Tax Rate Is the income tax depicted here progressive, regressive, or proportional?A decrease in government spending will cause a(n) _____.
  16. Which one of the following is not an excise tax of the federal government?
  17. One important reason why the United States government is not likely to go bankrupt even with a large public debt is that it has
  18. The circular flow model with government included would show that government
  19. Which of the following statements about payroll taxes is false?
  20. The table below presents the tax revenue and spending for the government over five years.
  21. Which one of the following is not a major source of funds for the U.S. federal government?
  22. Which of the following is nota significant source of revenue for the U.S. federal government?
  23. A budget surplus means that
  24. Which of the following descriptions is most representative of the mix of revenues and expenditures of the federal government?
  25. Which of the following descriptions is most representative of the mix of revenues and expenditures of a local government?
  26. Which of the following is not a government activity that is involved in public finance?
  27. The table below presents the tax revenue and spending for the government over five years. Government Revenue and Spending a. Under the "Budget Amount" column calculate the annual budget outcome. b. Under the "Budget" column determine whether the annual budget outcome is a budget surplus, budget deficit, or a balanced budget. c. Suppose the government has no debt entering into year 1. At the end of year 5, what is the government's level of debt?
  28. Use the following table which shows the aggregate demand and aggregate supply schedules for a hypothetical economy to answer the next question.
  29. The equilibrium price and output levels will be _____.
  30. The foreign purchases, interest rate, and real-balances effects explain why the ____________.
  31. Use the following graph to answer the next question. If AD1 shifts to AD2, then the equilibrium output increases from _____. The long-run aggregate supply curve is _____.
  32. Use the following graph to answer the next question. When output increases from Q1 and the price level decreases from P1, this change will _____. An aggregate supply curve represents the relationship between the _____.
  33. Use the following graph to answer the next question. If AD1 shifts to AD2, then the equilibrium output increases from _____. The long-run aggregate supply curve is _____.

 

Practice Homework: Aggregate Demand and Aggregate Supply Quiz

Includes Questions and Answers, practice quizzes combined - more questions included than are shown here A+ Work!

  1. Sources of revenue are the same for federal, state, and local governments.
  2. Which of the following is not an area of most federal spending?
  3. Interest on the national debt is a major expenditure for the federal government which indicates that the federal government:
  4. At the state government level, the main sources of income are:
  5. The main source of income for ___________ governments is property taxes.
  6. To provide goods and services, the government needs a source of ________
  7. At the federal government level, which of the following are the main sources of income?
  8. More often than not, the federal government spends ______than it receives in revenue forcing it to borrow to finance its deficits
  9. State governments spend money on all of the following except:
  10. The main source of income for local governments is ___________ taxes.
  11. The main source of income for __________ governments is property taxes.
  12. Sales taxes are_________, in that the tax rate falls as the amount taxed rises.
  13. An average tax rate equals the amount of tax paid______, by income and multiplied by 100
  14. The average tax rate:
  15. Most local governments also receive financial support from the _______ and ______levels.
  16. Most local governments receive financial support from the federal and state levels. (True or False)
  17. A(n)_________, tax rate equals the amount of tax paid divided by income and multiplied by 100. (Use one word for the blank.)
  18. Federal income taxes are ____________ (progressive/proportional/regressive).
  19. The type of tax that is assessed is determined:
  20. Daniel has an annual taxable income of $25,000 and pays $2,500 in income taxes. Julia has a taxable income of $45,000 and pays $5,000 in income taxes. This tax is:
  21. Sales taxes are ­­­­­­­­­­­­­­­­­_________ in that the tax rate falls as the amount taxed rises.
  22. A budget ______occurs when a government receives more revenue than it spends in any given fiscal year.
  23. Revenue sources are different for federal, state, and local governments. (True or False)
  24. Suppose that tax revenue is $300 billion and that government spending is $350 billion. The budget is:
  25. The type of tax (progressive, regressive, or proportional) is determined by using the ________ tax rate.
  26. A progressive tax is one in which the average tax rate _________ (one word) as income increases.
  27. A(n) ____________tax is one in which the average tax rate stays the same as income increases.
  28. A regressive tax is one in which the average tax rate _________ as income increases.
  29. A budget deficit occurs when a government receives ____ revenue than it spends in any given fiscal year.
  30. The type of tax that is assessed is determined:
  31. Medicare taxes are an example of a:
  32. When the government needs to borrow money, it _______ the demand for loanable funds in the economy.
  33. The government budget may be in ______, in _______, or in _________.
  34. Suppose that tax revenue is $300 billion and that government spending is $250 billion. The budget is:
  35. Most economists prefer measuring the deficit relative to GDP because:
  36. The national _____ is the accumulation of deficits and surpluses over time.
  37. Budget deficits are calculated and reported on a(n) _____basis.
  38. The federal government finances its deficits via ______
  39. A budget is balanced when the government’s revenue ______ what the government spends in any given fiscal year.
  40. Most economists prefer measuring the deficit relative to _______ because it places the deficit in better context and allows a comparison across time or across governments from different countries.
  41. The national debt is the accumulation of  _______ and ________ over time.
  42. Suppose that the government runs a budget deficit of $75 billion in year 1. Assume that the year began with a national debt of $25 billion. In year 2 the government ran a budget surplus of $50 billion. In year 3, the government spent $100 billion more than it collected in taxes. The debt is $ _______billion.
  43. A budget deficit occurs when a government receives ___ revenue than it spends in any given fiscal year.
  44. Suppose that the government runs a budget deficit of $75 billion in year 1. Assume that the year began with a national debt of $0. In year 2 the government ran a budget surplus of $50 billion. In year 3, the government spent $200 billion more than it collected in taxes. The debt is       billion.
  45. Which of the following events would most likely reduce aggregate demand?
  46. The labels for the axes of the aggregate demand graph should be
  47. A decrease in expected returns on investment will most likely shift the AD
  48. curve to the _____.
  49. Which would most likely shift the aggregate supply curve? A change in the prices of
  50. The short-run version of aggregate supply assumes that product prices are _____.
  51. The economy's long-run AS curve assumes that wages and other resource prices
  52. The long-run aggregate supply analysis assumes that _____.
  53. Which of the following effects best explains the downward slope of the aggregate demand curve?
  54. In the aggregate demand-aggregate supply model, the economy’s price level is assumed to be _____.
  55. A decrease in labor costs will cause aggregate _____.: 06_12_2018
  56. An aggregate supply curve represents the relationship between the _____.
  57. Refer to the graph shown. An economy is in both short- and long-run equilibrium at _____. The intersection of the aggregate demand and aggregate supply curves determines the _____. If the national incomes of our trading partners increase, then our aggregate demand _____.
  58. Use the following graph to answer the next question. When output increases from Q1 and the price level decreases from P1, this change will _____.  The aggregate supply curve (short run) _____. If at a particular price level, real output from producers is greater than real output desired by purchasers, then there will be a general _____.
  59. Use the following graph to answer the next question. If current output is Q1 and full-employment output is Q3, then in the long run the short aggregate supply schedule is _____. Which would most likely increase aggregate supply?
  60. Use the following graph, which shows an aggregate demand, to answer the next question.If the economy is at point C and the price level increases by 100, then the real balances, interest-rate, and foreign purchases effects will _____.

Discussion - Aggregate Demand

The aggregate demand and the aggregate supply model allows us to examine how a variety of events can affect the economy.
In your own words, discuss which of the four sources identified with aggregate demand has caused a change in the aggregate demand for a product or service you or your employer use. Share the effect that source has had on how you or your employer contribute to the measurement of aggregate demand.

 

 

 

ECO/372T Week 4 Apply Summative Assessment Money & the Federal Reserve Quiz
ECO/372T Week 4 Apply Summative Assessment Money & the Federal Reserve Quiz
ECO/372T Week 4 Apply Summative Assessment Money & the Federal Reserve Quiz
ECO/372T Week 4 Apply Summative Assessment Money & the Federal Reserve Quiz
ECO/372T Week 4

 

Everything listed for Week 2 is included in purchase!! 

 

ECO/372T Week 4 Tutorials Kit includes:

 

 

Apply: Money and the Federal Reserve Quiz

ncludes Questions and Answers, plus additional questions - A+ Work!

 

 

Practice Homework: Money and the Federal Reserve Quiz

Includes Questions and Answers, all practice quizzes combined - A+ Work!

  1. Use the following table to determine the levels of M1 and M2 in the United States. Calculate the M1 money supply. Calculate the M2 money supply:
  2. Money is:
  3. Explain the changes in M1 and M2 for each of the following scenarios. When Lily transfers $100 from her savings account into her checking account, M1______ and M2 _________. If Miguel deposits $200 cash into his money market mutual fund, M1 ________ and M2 _________. If Sam takes $1,000 from his savings account to purchase Microsoft stock, M1 _______ and M2 ________.
  4. The Federal Reserve District Banks are divided:
  5. Suppose the Federal Reserve increases the amount of reserves by $100 million and the total money supply increases by $500 million.
  6. The part of the Federal Reserve that determines and implements the nation’s monetary policy and controls the money supply to promote stable prices and economic growth is the
  7. Suppose that Ava withdraws $300 from her savings account at Second Bank. The reserve requirement facing Second Bank is 10%. Assume the bank does not wish to hold any excess reserves of the new deposits.
  8. Which of the following functions of money enables society to gain the benefits of geographic and labor specialization?
  9. Which of the following would be considered to be the most liquid?
  10. Which of the following varies directly with the interest rate?
  11. the opportunity cost of holding money
  12. Who determines the size of the money supply in the United States?
  13. If, in the market for money, the amount of money supplied exceeds the amount of money households and businesses want to hold, the interest rate will
  14. Use the following diagram of the market for money to answer the next question. The equilibrium interest rate is
  15. An increase in the money supply is likely to reduce
  16. Suppose there is an increase in money demand, as a result interest rates will
  17. Use the following graph to answer the next question. The graph shows the supply and demand for money where Dm1, Dm2, and Dm3 represent different demands for money and Sm1, Sm2, and Sm3 represent different levels of the money supply. The initial equilibrium point is A. What will be the new equilibrium point following an autonomous increase in the asset demand for money?
  18. Holding the money deposits of businesses and households and making loans to the public are the basic functions of
  19. The equilibrium rate of interest in the market for money is determined by the intersection of the
  20. The Federal Reserve System was established by the Federal Reserve Act of
  21. If the reserve requirement is 20% and commercial bankers decide to hold additional excess reserves equal to 5% of any newly acquired checkable deposits, then the effective monetary multiplier for the banking system will be
  22. If you put a $20 bill in the pocket of your winter coat at the beginning of spring so that you will be surprised when you find it again next winter, you are using money as
  23. The reason for the Fed being set up as an independent agency of government is to
  24. The required-reserve ratio is equal to a commercial bank’s
  25. The M2 measure of money consists of the sum of
  26. Which definition(s) of the money supply include(s) only items that are directly and immediately usable as a medium of exchange?
  27. The M1 measure of money consists of the sum of
  28. Money functions as a store of value if it allows you to
  29. Money eliminates the need for a coincidence of wants in trading primarily through its role as a
  30. The Federal Open Market Committee (FOMC)
  31. If the reserve requirement were 15% percent, the value of the monetary multiplier would be
  32. Use the following graph to answer the next question. Which line in the graph would best illustrate the supply of money curve?
  33. A checkable deposit at a commercial bank is a(n)
  34. The Federal Open Market Committee (FOMC) of the Federal Reserve System is primarily for
  35. The coupon rate is the
  36. Which of the following are liabilities to a bank?
  37. Other things being equal, an expansion of commercial bank lending
  38. A bank’s required reserves can be calculated by
  39. Members of the Federal Reserve Board of Governors are
  40. Money is “created” when
  41. Assets of the commercial banking system include
  42. The Federal Reserve System consists of which of the following?
  43. An increase in nominal GDP will
  44. Assume that the required reserve ratio is 20%. A business deposits a $50,000 check at Bank A, the check is drawn against Bank B. What happens to the reserves at Bank A and Bank B?
  45. One hundred percent reserve banking refers to a situation in which banks’ reserves equal One hundred percent of their
  46. Which group is responsible for the policy decision of changing the money supply?
  47. A bank has $2 million in checkable deposits. In the bank’s balance sheet, this would be part of
  48. What function is money serving when you deposit it in a savings account?
  49. Which of the following items are included in money supply M2 but not M1?
  50. Use the following graph to answer the next question. Which line in the graph above would best illustrate the asset demand for money curve?
  51. A consumer holds money to meet spending needs. This would be an example of the
  52. Cash held by a bank in its vault is part of the bank’s
  53. If product prices were stated in terms of tobacco leaves, then tobacco leaves would be functioning primarily as
  54. One year before maturity the price of a bond with the principal amount of $1,000 and a coupon rate of 5% paid annually fell to $981. The one year interest rate must be
  55. Credit card balances are not considered to be money primarily because they
  56. The functions of money are to serve as a
  57. Traditionally, the Federal Reserve can give emergency loas only to
  58. Fractional reserve banking refers to a system where banks
  59. The main function of the Federal Reserve System is to
  60. A Bank’s net worth is equal to its
  61. A wealthy executive is holding money, waiting for a good time to invest in the stock market. This action would be an example of the
  62. __________is any item that both buyers and sellers will accept in exchange for goods and services. (Enter one word in the blank.)
  63. When people specialize and produce the goods for which they have a(n)
  64. Gold, silver, and other metals have been used as
  65. Comparisons of the value of goods relative to everything else are easy when money is used as:
  66. Knowing how much money an economy has matters because it helps determine interest rates and prices. (True or False)
  67. ________as a means of exchange in our economy makes it easier for people to make transactions with each other.
  68. The Federal Reserve is commonly called the
  69. You can specialize at doing one thing whether its fixing cars, teaching economics, making cakes, or building websites in an economy that uses:
  70. ________consists of the most liquid forms of money.
  71. The first time money represented value, instead of being intrinsically valuable like a gold coin, was:
  72. A deposit account that accepts deposits and purchases bonds and commercial debt that pay interest is a:
  73. When used as an asset that is commonly used to facilitate trade between buyers and sellers, money is:
  74. ____in active circulation includes money in everyone's pockets and is part of____
  75. Knowing how much money an economy has matters because it helps determine:
  76. You can write a check to pay for goods and services. The check itself is:
  77. Which entity controls the money supply?
  78. Which of the following is considered money?
  79. M1 consists of the most____ forms of money
  80. Which of the following is a primary role of the Federal Reserve?
  81. _____deposit is an interest-bearing deposit held by a bank or financial institution for a fixed term, whereby the depositor can only withdraw the funds after giving notice.
  82. Monetary policy affects____ rates charged on loans and paid on savings.
  83. _______is the measure of money supply that contains currency or assets that can almost immediately be transferred into currency without penalty.
  84. The fraction of checkable deposits that banks must keep on hand as reserves either as currency or on deposit with the Federal Reserve is called the:
  85. When a check_______and money is transferred out of a checking account, it is the transfer of funds that constitutes the actual payment for the good and service.
  86. The primary entity charged with supervision and regulation of member banks to prevent banking panics or disruptions is called the
  87. Deposits that automatically transfer money balances from savings accounts to checking accounts are part of which definition of the money supply?
  88. Directing monetary policy and supervising member banks is done by:
  89. The entity that is responsible for overseeing research into domestic and international financial conditions and investigating the health of the U.S. economy, the effect of banking laws, and other issues that consumers and businesses face is the:
  90. policy refers to the Fed's actions to influence the supply of money and credit in the U.S. economy.
  91. _______serves as the bank for the federal government. (Enter one word in the blank.)
  92. ________rate is the interest rate at which banks can borrow money directly from the Federal Reserve.
  93. Which of the following is the primary entity charged with supervision and regulation of member banks to prevent banking panics or disruptions?
  94. Small denomination time deposits are part of which definition of the money supply?
  95. An important role of________banks is to make loans to banks that fall short of funds.
  96. Which of these serves as the bank to the federal government?
  97. The interest rate at which banks can borrow money directly from the Federal Reserve is called the:
  98. _________manages the supply of currency.
  99. Banks can influence the money supply by
  100. ________are organizations that connect people with money to people who want it.
  101. When people deposit money, the bank provides valuable services in return:
  102. _________requirement specifies the fraction of checkable deposits that a bank must keep on hand.
  103. Suppose the reserve requirement is 5 percent. For every $100 on deposit, the bank needs to hold $
  104. Banks play a crucial role in determining____rates and the____supply
  105. The total reserves equal____reserves plus_____reserves
  106. If the bank keeps all of its deposits as __ ,the bank won't make any money. (Use one word for the blank.)
  107. The reserves of a bank held as currency earn little to no interest. (True or False)
  108. Because a bank may need to have only a fraction of deposits on hand, the rest is used to make____ that earn interest, which is used to cover the costs of running the bank and hopefully earn a(n)____
  109. The reserve requirement is the____ percentage of deposits that banks must keep on hand as reserves.
  110. Loans are____to a bank and a____to the person who borrowed the money.
  111. Assume the reserve requirement is 10%. Brian deposits a check for $2,500 at his bank. Excess reserves are $
  112. ________reserves are the total amount of reserves that a bank has some of which it is required to keep on hand.
  113. The cost of keeping more reserves than the fraction required instead of lending these funds out is the____ cost of the forgone interest the funds would have earned.
  114. People rarely take all their deposits out at once, so on any given day the bank may need to have only a(n)____ of deposits on hand to honor checks pay bills or handle normal withdrawals.
  115. ________fraction of the money in an economy is issued by the Federal Reserve; the rest is created by the_______
  116. When a bank makes a loan, it hands over some of its____ to the person who borrowed the money.
  117. Andy deposits $100 of currency in his checking account. What effect does this transaction have on M1?
  118. Suppose the reserve requirement is 20 percent. For every $100 on deposit, the bank needs to hold $
  119. _______reserves are equal to total reserves minus required reserves.
  120. The reserves of a bank held as currency earn little to no interest. (True or False)
  121. With fractional reserve banking,:
  122. The coins and paper money you use to buy goods and services can be printed:
  123. Which of the following are likely to occur when someone deposits money into a checking account?
  124. If someone deposits money into a checking account, the bank’s
  125. Suppose the reserve requirement is 5 percent. For every $100 on deposit, the bank needs to hold $
  126. _______reserves are the total amount of reserves that a bank has some of which it is required to keep on hand.
  127. Banks can create money by making use of:
  128. When an individual deposits a check at the local bank, the bank's reserves___. The bank can use most of those reserves to make____
  129. The overall change in the money supply given an initial change in reserves depends on the
  130. If someone deposits money into a checking account, the bank’s:
  131. _______is the amount by which a $1 change in reserves will change the money supply.
  132. ________reserves are equal to total reserves minus required reserves.
  133. When an individual deposits a check at the local bank, the bank's reserves increase. The bank can use most of those reserves to make ________. This _______ the money supply.
  134. Suppose the Federal Reserve has set the reserve requirement at 12%. What is the money multiplier?
  135. The actual money multiplier tends to be
  136. If the reserve requirement is 10% and we want to increase the money supply by $50 billion, the Fed will need to increase reserves by $
  137. If someone deposits money into a checking account, the bank’s
  138. In order to conduct daily transactions and have a stable asset for future purchases,
  139. __________money demand is the demand for money to be used to purchase goods and services.
  140. The interest rate:
  141. Since we can't use stocks and bonds for daily transactions, people hold some of their savings as
  142. _____can affect the money supply by increasing or decreasing the number of loans they make.
  143. The demand for money comes from two sources:
  144. ________is the payment made to agents that lend or save money.
  145. ________rate is the payment made to agents that lend or save money expressed as an annual percentage of the monetary amount lent or saved.
  146. _______is a situation in which the quantity supplied is greater than the quantity demanded at the
  147. current market price.
  148. This organization or person can change the money supply by increasing or decreasing the amount of reserves in the banking system:
  149. The interest rate:
  150. Because the money supply is independent of the interest rate, it is a
  151. is a situation in which the quantity supplied is less than the quantity demanded at the current market price.
  152. When you borrow money, you'll pay a certain interest rate; when you save, you'll earn a different interest rate. (True or False)
  153. Because the money supply is independent of the interest rate, it is a
  154. The money supply is a vertical line because it is:
  155. Changes in the price level, changes in real GDP, and uncertainty about the future are all considered:
  156. We construct the total demand for money by adding the
  157. _________market is a market in which the demand for and supply of money determine an interest rate or opportunity cost of holding money balances.

Discussion - Transaction and Asset Demand

Compare and contrast the transaction demand and asset demand for money.

  • What is the relationship between interest rate, aggregate income, and price level?
  • Provide two specific examples of transaction demand for money.
  • Provide two specific examples of asset demand for money. 

 

ECO/372T Week 5 Apply Summative Assessment Fiscal and Monetary Policy
ECO/372T Week 5 Apply Summative Assessment Fiscal and Monetary Policy
ECO/372T Week 5 Apply Summative Assessment Fiscal and Monetary Policy
ECO/372T Week 5 Apply Summative Assessment Fiscal and Monetary Policy

ECO/372T Week 5

Everything listed for Week 2 is included in purchase!! 

 

ECO/372T Week 5 Tutorials Kit includes:

 

 

Apply: Summative Assessment: Fiscal and Monetary Policy Quiz

ncludes Questions and Answers, plus additional questions - A+ Work!

 

 

Practice Homework: Fiscal and Monetary Policy Quiz

Includes Questions and Answers, plus additional questions - A+ Work!

 

 

Discussion - Fiscal Policy During a Recession