GDP
GDP stands for what:
Gross Domestic Product
Give an example of a physical good that could be used as currency that is not a paper bill or metal coin
Answers may vary
Are Free Trade policies Market Oriented or Command Oriented?
Market Oriented
What type of economy is the United States?
A mixed-market oriented economy
When the federal gov't. can influence the economy by its spending, taxing, and borrowing of local, state, and federal gov't. is a description of what type of policy?
Fiscal Policy
What is the GDP that measures for inflation?
Real GDP
Name the missing characteristic of money
Durable, Uniform, ___, Portable, Limited, Accepted
Divisible
if Japan produces 500 cars and 300 socks per day and Italy can produce 600 cars and 400 socks per day who has the absolute advantage in car production
Italy has the Absolute Advantage
This type of economic system bases its decisions on customs and tradition
Traditional Economy
Monetary Policy is controlled by which body
Double Jeopardy
The Federal Reserve
If the Real GDP is $100 and the number of people in a country is 20, then the Real GDP per capita of that country is:
Real GDP per capita is 5
What is the ideal inflation rate?
2%
The nuclear bomb being created by many countries after WW2 is an example of what type of globalization?
Military globalization
The factors of production are owned by who in a command economy
The government
If the Federal Reserve wants to fight inflation what do they do?
Raise the discount rate (interest rates)
Lowes sells a shed, the nails and wood that go into the shed are what type of good (that does NOT count toward GDP)
Double Jeopardy
Intermediate goods
When there is not enough resources to satisfy the desires of all people, that is called:
Double Jeopardy
Scarcity
What are the 5 aspects of globalization?
Economic, Technological, Cultural, Political, Military
What are the 4 factors of production?
Land, Labor, Capital, and Entrepreneurship
A theory that advocates for supply and demand to be the main determinants of the economy?
Neoclassical Economics
What is the formula for calculating GDP (expenditure model)
C = consumer spending +
I = investment spending +
G = government purchases +
X = exports -
M = imports
This term measures the change over time in the prices paid by consumers for a representative basket of goods and services. (The tool that measures inflation)
Consumer Price Index (CPI)
When a good can be created at a lower relative opportunity cost to another good
Comparative Advantage
What is an example of a disadvantage that is associated with a free market economy?
Does not provide basic needs for all citizens
Lots of risk & uncertainty
Struggles to provide services that aren't profitable (Roads, military, water, etc...)
Can easily fail if certain conditions aren't met
A economic belief that government intervention was necessary for a productive economy
Keynesian economics