 Which of the following is not an economics indicator discussed in class?

Presidential Policy
 Which of the following type of spending do not fall under GDP? Imports
 In the business cycle, growing GDP and inflation are signs of a recession. False
 The value of money is greater as prices inflate over the course of history. False
 Government spending makes up the largest portion of the nation’s GDP False
 Completed goods counted in the GDP Final Goods
 Unemployed plus employed Labor Force
 Someone without a job a job who has quit looking Discouraged Worker
 The general increase in the price of goods and services Inflation
 Someone without a job, but looking Unemployed
 Unemployment caused by lack of skills or demand Structural Unemployment
 Is a way to illustrate how a regular group of goods and services changes over time Consumer Price Index
 Which is an example of government Spending? Road Construction
 It is the study of the nation’s economy as a whole Macroeconomics
 It is the measure of a country’s total production of final goods and services in a given period of time Gross
Domestic Product
 What do you call an economic policy that is designed to influence the aggregate demand in order to control the
economy? Fiscal Policy
 It is the continuing increase of the general price level in the market Inflation
 It is the decrease in the general level of prices of basic commodities Deflation
 This happens when there is an increase of the production of goods and services. Economic Growth
 Which of the following situation describes unemployment? Sharon just graduated from college
 It is the total market value of all the final goods and services in a given period of time by the country’s citizens.
Gross National Product
 Solve the GDP using the expenditure method. 423M
 It is the measure of national output that adjusts GNP to account for price changes. Real GNP
 It captures the prices of goods and services that consumers typically buy. Consumer Price Index
 It is the ability of the peso to purchase goods and services. PPP
 Which agency is tasked of creating Monetary Policy? Bangko Sentral ng Pilipinas
 Who’s economic slowdown has become concerning to other countries? (specifically Latin America)? China
 GDP, CPI, and the unemployment rate are all economic indicators used to determine the state and direction of
the economy.
 Saying that net exports are positive is the same as saying that there is a current account surplus
 A pair of shoes that costs $80 last month costs $100 this month. Which of the following BEST describes this
condition? Inflation
 Which of the following might be a sign of an economy trough? Recession
 Consumers reduce spending because they lack confidence in the economy. All else being equal, what effect will
this have on the price level and GDP? Both prices and real GDP will decline
 If one wanted to know whether there had been inflation or not, the BEST measure to observe would be the CPI
 Which of the following would be MOST LIKELY to increase aggregate demand? Increasing consumer confidence
 What is money? Any item accepted as payment for goods or services
 The labor force consists of all employed and unemployed civilian workers
 If Congress increases government spending by the same amount it increases taxes aggregate demand will
Increase
 Money loses its value when it it becomes too plentiful
 Which of the following is a monetary policy action used to combat a recession? Increasing the money supply
 Which of these is MOST LIKELY to occur after the government increases taxes? Consumer spending decreases
 How many stages are there in the business cycle? 4
 What is inflation? The general increase in prices
 What are capital gains? A profit from the sale of property or investment
 What is a cartel? A group of producers that work together to protect their interests
 What is trade embargo? A government order that restricts trade within a specific country
 What does CPI stand for? Consumer Price Index
 What is CPI? Measures the average price of consumer goods/services
 What is a trade tariff? A tax on traded products
 What is a competitive advantage? Conditions that allow a company to make stuff at equal price or a lower
price
 What is absolute advantage? When a company can make more stuff than competitors using the same amount
of resources
 Which is better for a company? Absolute Advantage
 What is the monetary policy? The changing of interest rate and influencing money supply
 What is the fiscal policy? When the government changes tax rates
 Which is hurt the most by inflation. People on fixed income
 Process by which the government manages public spending and taxation Fiscal Policy
 Which is the true of the sin tax all of the above
 Which is considered a “sin tax” Tax on tobacco
 A barter system does not use Money
 During a recession, growth has Declined
 When interest rates drop, the money supply increases
 If minimum wage laws were repealed Employers would hire more people
 Which is not a function of money Traded Item
 Which can make borrowing money less desirable Increase interest rate
 People usually use what to purchase a car. Loan
 An example of the government trying to get the economy out of recession is Build more highways
 Open market operations and discount rates are used in Monetary Policy
 A budget surplus Shrinks the debt
 Raising the discount rate Raises all interest rates
 An example of expansionary fiscal policy is Raising government spending
 The government should increase their spending if all of the above
 What is the banks’ reserve requirements? How much money a bank is required to hold on to
 A recession results in all of the above
 A budget deficit increases national debt
 When the government spends more money than they take in each year is called a Deficit
 Which of the following scenarios would cause the nation’s money supply to increase? Lowering interest rates
 Inflation is measured by Consumer Price Index (CPI)
 Increasing reserve requirements is used to stop inflation
 Which of these is NOT a monetary policy tool? Balance Accounts
 Too much money in our economy leads to Inflation
 Fiscal policy aims to influence the economy activity through the use of government spending & taxation
 To promote higher economic growth, the best way is to increase government spending and decrease taxation
 Which of the following are responsible for making Fiscal policy decision? The President and Congress
 How does a budget deficit relate to the national debt? Budget deficits create the national debt
 To promote higher economic growth, the best way is to increase government spending and decrease taxation
 Congress cutting taxes is an example of Fiscal Policy
 All of these are components of the expenditure approach to GDP EXCEPT Taxes
 The Consumer Price Index (CPI) can be defined as A measure of inflation based on the cost of a fixed “money
basket”
 If the economy is in a recession, which policy would Congress want to enact to fix the problem? Expansionary
fiscal policy
 When economists say that money serves as a unit of account, they mean that it is a monetary unit for
measuring and comparing the relative values of goods
 If the quantity of money demanded exceeds the quantity supplied the interest rate will rise
 Which of these is the BEST definition of GDP? Market value of all goods and services produced in a country
 Which pairs of operations BEST fit with fiscal policy? Government spending & taxation
 A recession is a short term downfall of economic activity
 Select the three macroeconomic policy goals from the following list Keep prices table / Limit unemployment /
Keep the economy growing overtime
 Macroeconomics is the study of the entire country
 The economy isn’t doing very well due to a recession. Lots of people have been laid off and no one is buying
anything because they don’t have the money. If Congress and the President want to stimulate the economy,
which policy should they choose? Cut Taxes
 People can get more of what they want through trade than they could if they tied to be self-sufficient True
 An individual has a COMPARATIVE ADVANTAGE in producing a good or service if the opportunity cost of
producing the good or service is lower for that individual than for other people
 A market in which there are many buyers and sellers of the same good or service, none of whom can influence
the price at which the good or service is sold Competitive Market
 The Supply and Demand model is a model of how a Competitive market works