macroeconomics final exam example #18681

Total income households have after paying taxes and receiving government transfers

Market failure may occur because

A graphical representation of the relationship between the total quantity of goods and services demanded and the price level

If banks were required to keep 100% of deposits in reserves, they could

The point on a business cycle when real GDP stops falling and begins rising

In the long run, changes in the money supply

The double coincidence of wants problem can be solved by

An inflationary gap can be closed with

Monetary policy affects GDP and the price level by

The short-run aggregate supply curve is positively sloped because

nominal GDP

real GDP

The money spent on domestically produced final goods and services

Diminishing returns to physical capital means that as more and more physical capital is combined with a fixed amount of human capital with a fixed technology, eventually

The most important factor affecting a household's consumer spending is

A contractionary fiscal policy is a policy that

The CPI is used for calculating payments from the U.S. government to individuals. To the extent it is biased upward, this index

Physical capital would include

In the "paradox of thrift"

Long-run growth is the sustained upward trend in

When the value of a nation's imports exceeds the value of that nation's exports, the nation is said to have

Deflation

Among the assets of a bank are

The marginal propensity to save is

The process of bringing down inflation that has been embedded into expectations is called

Technological improvements will

Which of the following is included in GDP

A key insight into macroeconomics is that in the short run the combined effect of individual decisions is

The short-run Phillips curve represents the relationship between the unemployment rate and the rate of change in

Which of the following demonstrates how people respond to incentives to make themselves better off?

In the classical model, it is thought that the long-run

When banks borrow and lend reserves from each other, they are participating in the ______ market

The models used in economics

Conditional convergence suggests

An increase in the supply of money will lead to ___ in equilibrium real GDP and ___ in equilibrium interest rate

A liquidity trap is a situation in which

Contractionary monetary policy involves

Medicaid, Medicare and Social Security are examples of

When a local factory closes, why does it spell bad news for the local restaurants?

Human capital is

Sources of funds for investment spending are

The inflation tax is

Long-run economic growth is

According to the liquidity preference model, if the Fed increases the money supply, the equilibrium interest rate ____, and this leads to ____ in the quantity demanded of nonmonetary interest-bearing financial assets

When the output gap is ____, reflecting an inflationary gap, the unemployment rate is ____ the natural rate of unemployment

Among the losers with unexpected deflation are

In the simplest circular-flow model, households supply ____ and demand ____

Decisions about monetary policy are made by

Examples of bank regulations designed to prevent bank runs are

Labor productivity growth can be attributed to

The reserve ratio is the

Inflation is a situation where

An economy is said to have a comparative advantage if it

The value of MPC is

A recession leads to

The best currently available measure of the standard of living in a country is

Money whose value derives entirely from its official status as a means of exchange is known as

Suppose a panel of economists is predicting that a nation's real GDP per capita will double in approximately 20 years. Based upon the Rule of 70, what must be the predicted annual growth rate of real GDP per capita?

A recessionary gap can be closed with

Among the public goods important for economic growth are

The long-run aggregate supply curve is vertical because in the long run

A cut in taxes will have a greater impact on aggregate demand if it is given to

The opportunity cost of holding money is

A choice made___ is a choice whether to do a little more or a little less of something

Gains from trade arise because of

Monetary policy is similar among wealthy countries because the central banks of most countries

The idea that a 1 percentage point increase in the output gap will decrease the unemployment rate by 1/2 of a percentage point is known as

An increase in the aggregate price level

Gross domestic product is defined as

Which of the following combination of assets are considered to be money?

Economists generally believe that a country should specialize in the production of a good or service if

The amount of money that people demand is

Growth accounting enables us to

As a consequence of the existence of a nonaccelerating-inflation rate of unemployment, or NAIRU

Which of the following would shift the aggregate demand curve to the left?

If the Fed wants to decrease interest rates, it can

If the multiplier is 4, and investment spending falls by $100 billion, the change in equilibrium income will be

When the economy is in a recession

To ____ the money supply, the Fed could ____

We have to make choices because

Real GDP is nominal GDP adjusted for

a shift to the left of the AD curve could be cause by

The purpose of macroeconomic policy is to

Treasury bills

Which of the following is a tool used by the Fed in the conduct of monetary policy?

If the short-run macroeconomic equilibrium is ____ of the economy's potential output, then there is a(n) _____ and the aggregate price level is expected to ____

The convergence hypothesis helps explain why

Monetary base is

An upward shift in the consumption function can be caused by

If the money supply increases by 10%, in the long run