Econ CEA-Fall 2015 - Assignment Essays

question

Depreciation exceeds domestic investment

answer

Net investment is negative

question

Real GDP measures

answer

current output at base year prices

question

Difference between real and nominal GDP

answer

Real GDP has been adjusted for changes in the price level

question

The GDP tends to

answer

understate economic welfare because it does not take into account increase in leisure

question

GDP

answer

monetary value of all final goods and services produced by a nation's economy during a year

question

example of an investment according to economists

answer

construction of a new computer chip factory by Intel

question

Find Net Exports

answer

(consumer expenditures + gov. purchases + gross private domestic investments) - GDP

question

When GDP is less than Net Exports

answer

Net exports are negative

question

consumer price index attempts to measure changes in

answer

the price of a select marker basket of goods and services

question

A fear of unwanted price wars may explain why many firms are reluctant to

answer

reduce prices when a decline in aggregate demand occurs

question

the foreign purchases effect suggest that an increase in Japanese price level relative to other countries will

answer

increase Japanese imports and decrease Japanese exports

question

Which would most likely decrease aggregate demand

answer

an increase in person income tax rates

question

the slope the immediate-short-run aggregate supply curve is based on the assumption that

answer

both input and output prices are fixed

question

A decline in the quantity of real output demanded along the aggregate demand curve is a result of

answer

Increase in the price level

question

the economy experiences an increase in the price level and a decrease in real domestic output when

answer

input prices have increased

question

when real domestic output from producers is greater than real domestic output desired by purchasers there will be a

answer

surplus and the price level will fall

question

the size of the MPC is assumed to be

answer

greater than zero, but less than one

question

Find the expected rate of return

answer

(additional revenue - costs)/costs

question

If business taxes are reduced and the real interest rate increases

answer

the level of investment spending might either increase or decrease

question

multiplier effect

answer

an increase in investment can cause the GDP to change by a larger amount.

question

when disposable income decreases, consumption..

answer

and savings both decrease

question

if consumption schedule shifts downward and the shift was not cause by a tax change, then what happens to the saving schedule

answer

it will shift upwards

question

What would shift the consumption schedule upward

answer

an increase in wealth

question

there is an inverse relationship between the rate of interest and the level of

answer

investment spending (is suggested by the investment-demand curve)

question

What would decrease investment demand

answer

an increase in the cost of acquiring capital goods

question

the greater the MPS, the..

answer

smaller the increase in income would be.(which results from an increase in the MPC)

question

What is a demand factor in economic growth

answer

an increase in total spending in the economy

question

The entry of women into the workforce since 1960 resulted in

answer

a shift outward in the production possibilities curve

question

a decline in a nation's rate of productivity growth will

answer

slow the growth of the standard of living

question

Rule of 70 (doubling time)

answer

70/annual growth (%)

question

Does the real GDP per capita grow faster or slower than the real GDP

answer

it can grow either slower or faster than the real GDP

question

growth is advantageous to a nation because it

answer

lessens the burden of scarcity

question

Economists believe that the recent increase in the average US productivity growth rate may have been causes by

answer

increased entrepreneurial activity, application of information technology and global competition

question

Critics of economic growth

answer

argue that economic growth dos not resolve socioeconomic problems such as an unequal distribution of income and wealth.

question

Real Gross Domestic Product

answer

will increase if there is an increase in the level of output

question

if real GDP increases by 5% while population of country increases by 7% then.

answer

output person necessarily decreases

question

Best example of financial investment

answer

a retiree purchases Google stock

question

the word "shocks" refers to

answer

situations where firms' expectations are unment

question

Higher oil prices are most likely to lead to

answer

a negative supply shock

question

the business cycle depicts

answer

short-run fluctuations in output and employment

question

About advanced economics

answer

Economies experience a positive growth trend over the long run, but experience significant variability in the long run

question

Before the period of economic growth

answer

rates of population growth virtually match rates of output growth

question

Difference between financial investment and economic investment

answer

Financial investment refers to the purchase of assets for financial gain, economic investment refers to the purchase of newly created capital goods

question

if an economy wants to increase its current level of investment, it must

answer

sacrifice current consumption

question

find APC

answer

Consumption/Output (DI=GDP)

question

find APS

answer

Saving/Output

question

find MPC

answer

Change in Consumption/Change in Income

question

find MPS

answer

Change in Savings/Change in Income

question

MPS +MPC = ?

answer

question

Breakeven point on a table is at

answer

savings is 0

question

DI = _ +_

answer

Consumption +Saving

question

find unemployment rate

answer

(unemployed/labor force) x 100

question

frictional unemployment

answer

short term, searching for job in the near future

question

structural unemployment

answer

long term, want to work but doesn't have the skills or experience

question

cyclical unemployment

answer

losing jobs due to economic fluctuations

question

Full employment

answer

only fictional and structural

question

Demand pull

answer

excess of total spending, increase in aggregated deamand

question

cost push

answer

rising per unit cost of production, increase in aggregated supply

question

monetary policy

answer

government spending

question

fiscal policy

answer

taxes

question

discretionary (active)

answer

eliminate recession gap

question

expansionary

answer

increase spending, lower taxes

question

contractionary

answer

decrease spending, increase taxes

question

progressive tax

answer

rises with GDP (tax rev/GDP)

question

proportional

answer

avg. tax remains constant

question

regressive

answer

avg. tax decreases as GDP increases

question

Aggregate demand has a downward slope because

answer

when price falls people buy more

question

consumer expectations

answer

when people expect their income to rise

question

household borrowing

answer

can increase their consumption spending by borrowing

question

Personal taxes

answer

reduction in personal income tax rates rise the take-home income which increases consumer purchases at each possible price level

question

An increase in money supply (AD questions)

answer

lowers interest rate, increases investment and AD

question

government spending increases (AD questions)

answer

shifts AD curve to the right

question

Aggregates supply in the short run

answer

direct relationship between price level and the amount of the real output

question

determinants of aggregate demand

answer

change in input price, change in productivity, change in legal-institutional environment,

1 of 74

question

Depreciation exceeds domestic investment

answer

Net investment is negative

question

Real GDP measures

answer

current output at base year prices

question

Difference between real and nominal GDP

answer

Real GDP has been adjusted for changes in the price level

question

The GDP tends to

answer

understate economic welfare because it does not take into account increase in leisure

question

GDP

answer

monetary value of all final goods and services produced by a nation's economy during a year

question

example of an investment according to economists

answer

construction of a new computer chip factory by Intel

question

Find Net Exports

answer

(consumer expenditures + gov. purchases + gross private domestic investments) - GDP

question

When GDP is less than Net Exports

answer

Net exports are negative

question

consumer price index attempts to measure changes in

answer

the price of a select marker basket of goods and services

question

A fear of unwanted price wars may explain why many firms are reluctant to

answer

reduce prices when a decline in aggregate demand occurs

question

the foreign purchases effect suggest that an increase in Japanese price level relative to other countries will

answer

increase Japanese imports and decrease Japanese exports

question

Which would most likely decrease aggregate demand

answer

an increase in person income tax rates

question

the slope the immediate-short-run aggregate supply curve is based on the assumption that

answer

both input and output prices are fixed

question

A decline in the quantity of real output demanded along the aggregate demand curve is a result of

answer

Increase in the price level

question

the economy experiences an increase in the price level and a decrease in real domestic output when

answer

input prices have increased

question

when real domestic output from producers is greater than real domestic output desired by purchasers there will be a

answer

surplus and the price level will fall

question

the size of the MPC is assumed to be

answer

greater than zero, but less than one

question

Find the expected rate of return

answer

(additional revenue - costs)/costs

question

If business taxes are reduced and the real interest rate increases

answer

the level of investment spending might either increase or decrease

question

multiplier effect

answer

an increase in investment can cause the GDP to change by a larger amount.

question

when disposable income decreases, consumption..

answer

and savings both decrease

question

if consumption schedule shifts downward and the shift was not cause by a tax change, then what happens to the saving schedule

answer

it will shift upwards

question

What would shift the consumption schedule upward

answer

an increase in wealth

question

there is an inverse relationship between the rate of interest and the level of

answer

investment spending (is suggested by the investment-demand curve)

question

What would decrease investment demand

answer

an increase in the cost of acquiring capital goods

question

the greater the MPS, the..

answer

smaller the increase in income would be.(which results from an increase in the MPC)

question

What is a demand factor in economic growth

answer

an increase in total spending in the economy

question

The entry of women into the workforce since 1960 resulted in

answer

a shift outward in the production possibilities curve

question

a decline in a nation's rate of productivity growth will

answer

slow the growth of the standard of living

question

Rule of 70 (doubling time)

answer

70/annual growth (%)

question

Does the real GDP per capita grow faster or slower than the real GDP

answer

it can grow either slower or faster than the real GDP

question

growth is advantageous to a nation because it

answer

lessens the burden of scarcity

question

Economists believe that the recent increase in the average US productivity growth rate may have been causes by

answer

increased entrepreneurial activity, application of information technology and global competition

question

Critics of economic growth

answer

argue that economic growth dos not resolve socioeconomic problems such as an unequal distribution of income and wealth.

question

Real Gross Domestic Product

answer

will increase if there is an increase in the level of output

question

if real GDP increases by 5% while population of country increases by 7% then.

answer

output person necessarily decreases

question

Best example of financial investment

answer

a retiree purchases Google stock

question

the word "shocks" refers to

answer

situations where firms' expectations are unment

question

Higher oil prices are most likely to lead to

answer

a negative supply shock

question

the business cycle depicts

answer

short-run fluctuations in output and employment

question

About advanced economics

answer

Economies experience a positive growth trend over the long run, but experience significant variability in the long run

question

Before the period of economic growth

answer

rates of population growth virtually match rates of output growth

question

Difference between financial investment and economic investment

answer

Financial investment refers to the purchase of assets for financial gain, economic investment refers to the purchase of newly created capital goods

question

if an economy wants to increase its current level of investment, it must

answer

sacrifice current consumption

question

find APC

answer

Consumption/Output (DI=GDP)

question

find APS

answer

Saving/Output

question

find MPC

answer

Change in Consumption/Change in Income

question

find MPS

answer

Change in Savings/Change in Income

question

MPS +MPC = ?

answer

question

Breakeven point on a table is at

answer

savings is 0

question

DI = _ +_

answer

Consumption +Saving

question

find unemployment rate

answer

(unemployed/labor force) x 100

question

frictional unemployment

answer

short term, searching for job in the near future

question

structural unemployment

answer

long term, want to work but doesn't have the skills or experience

question

cyclical unemployment

answer

losing jobs due to economic fluctuations

question

Full employment

answer

only fictional and structural

question

Demand pull

answer

excess of total spending, increase in aggregated deamand

question

cost push

answer

rising per unit cost of production, increase in aggregated supply

question

monetary policy

answer

government spending

question

fiscal policy

answer

taxes

question

discretionary (active)

answer

eliminate recession gap

question

expansionary

answer

increase spending, lower taxes

question

contractionary

answer

decrease spending, increase taxes

question

progressive tax

answer

rises with GDP (tax rev/GDP)

question

proportional

answer

avg. tax remains constant

question

regressive

answer

avg. tax decreases as GDP increases

question

Aggregate demand has a downward slope because

answer

when price falls people buy more

question

consumer expectations

answer

when people expect their income to rise

question

household borrowing

answer

can increase their consumption spending by borrowing

question

Personal taxes

answer

reduction in personal income tax rates rise the take-home income which increases consumer purchases at each possible price level

question

An increase in money supply (AD questions)

answer

lowers interest rate, increases investment and AD

question

government spending increases (AD questions)

answer

shifts AD curve to the right

question

Aggregates supply in the short run

answer

direct relationship between price level and the amount of the real output

question

determinants of aggregate demand

answer

change in input price, change in productivity, change in legal-institutional environment,

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