Term
| The total market value of all final goods and services produced in the economy during a period of time is how the ________________ is calculated. |
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Definition
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Term
| A decrease in interest rates |
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Definition
| increases investment spending on machinery, equipment, and factories, consumption spending on durable goods, and net exports |
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Term
| Fiscal policy is used by the federal government to |
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Definition
| offset the effects of the business cycle on the economy |
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Term
| The economic definition of ______________ is any asset that people are generally willing to accept in exchange for goods and services |
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Definition
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Term
| For most banks, their biggest asset is _________________ and their biggest liability is _______. |
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Definition
| Loans; customers’ checking accounts |
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Term
| An example of a person who is out of the labor force is ______________. |
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Definition
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Term
| The Consumer price index (CPI) measures |
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Definition
| the overall price level of goods and services in the economy |
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Term
| The invention of new computers that increase labor productivity would be expected to |
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Definition
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Term
| The discount policy, reserve requirements, and open market operations are all _________. |
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Definition
| policy tools used by the Federal Reserve to manage the money supply |
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Term
| High rates of saving and investment would most likely be an explanation for __________. |
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Definition
| high growth rates in real GDP |
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Term
| Changes in federal taxes and purchases that are intended to achieve macroeconomic policy objectives refers to |
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Definition
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Term
| Purchases of stocks and bonds ________ included in economists’ definition of Investment because ______________. |
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Definition
| are not; they are a financial asset, not a final good or service that is produced |
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Term
| The quantity theory of money predicts that, in the long run, inflation results from real GDP |
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Definition
| growing at a faster rate than the money supply |
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Term
| Real GDP is GDP in a given year |
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Definition
| valued in the prices of the base year |
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Term
| In the U.S., Consumption spending represents ______ of GDP, Investment spending represents ________. And Government purchases represent ______________. |
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Definition
| the largest share; the third largest share; the second largest share |
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Term
| Which of the following would explain a reduction in human capital in an economy? |
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Definition
| Disease, poor nutrition, and substandard health |
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Term
| Actions taken by the Federal Reserve to manage the money supply and interest rates to pursue its economic objectives refers to |
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Definition
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Term
| A slowdown in the economy would cause |
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Definition
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Term
| Which of the following is an accurate statement? |
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Definition
| A person on a fixed income during an inflationary period is hurt by inflation |
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Term
| The federal government can use fiscal policy to increase real GDP by |
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Definition
| increasing government purchases or decreasing taxes. |
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