Basic Econ
Limited resources but unlimited wants & needs
What is Scarcity
Definition of a recession.
2 quarters or more of declining RGDP
An event that shifts the aggregate supply curve
What is a supply shock
What is
-MPC/MPS
Value of one currency compared to another
What is exchange rates
What was the name of the first Disney princess?
Who is Snow White
This is the period of recovery after an economic downturn.
What is Expansion?
What is the relationship between interest rates and bond prices?
Inverse
Exists when Aggregate output is above potential output.
What is an inflationary gap
Administered Rates (interest on reserves & discount rate)
What are the two tools for ample reserves monetary policy?
How does the value of a currency change when another country demands more of their products
What is appreciate
What does NASA stand for
National Aeronautics and Space Administration
The most valuable thing given up when making a decision.
What is opportunity cost
New-Old/ Old x 100
What is the equation used to find changes in prices?
Caused by natural disasters and oil becoming expensive
What is Stagflation
MPC is 0.8 and government increases taxes by $50 million. What will occur to Real GDP?
What is decrease by 200 million.
LRAS, PPC, and Business Cycle
What is they all show economic growth
Who was the first basketball star to appear on a box of cereal?
Who is Michael Jordan
These points represent productive efficiency on the PPC graph.
What are points that are ON THE LINE?
What is the equation of exchange?
MxV= PxQ
SRAS curve increasing or decreasing back to equilibrium
What is self correcting
Expansionary Fiscal policy leads to increase _________ in the loanable funds market. Which causes interest rates to ___________. The inversely affects _______ & ________.
This situation is called ________________
What is demand, increase, I & NX, and crowding out?
Ethiopian fruits become more popular in America. What happens to the Ethiopian currency? What happens to the American? Explain.
Be detailed
Ethiopian currency will increase in demand and will cause the currency to appreciate
American currency will increase in supply and will cause the currency to depreciate
What is the biggest mammal in the world
What is a blue whale
On the PPC graph, an increase in unemployment could be represented by a movement by
What moving from a point on the line to a point below the line?
This type of unemployment describes a person who is unemployed because of a recession.
What is Cyclical Unemployment?
Curve that is used to measure potential .
What is Long Run Aggregate Supply
Susan makes a $100 deposit at City Bank. Their current reserve requirement is 10%. What is the change to the money supply based on Susan's deposit?
What is $900 increase
Remitopia has been exporting toys to Oliverland. While Oliverland does not export as much. What is happening in Remitopia and Oliverland's CA & CFA accounts?
Remitopia has a surplus in CA, deficit in FA
Oliverland has a deficit in CA, surplus in FA
What is the strongest muscle in the human body?
masseter or jaw muscle
In Velaris for every 1 chocolate pie being produced they could have made 2 apple pies. In Genovia for every 1 chocolate pie being made they could have made 4 apple pies. Who has the comparative advantage?
What is Velaris
This is the inflation rate from 2012 to 2013.
Year CPI
2012 229.6
2013 233.0
What is 1.5%?
(233.0 − 229.6)/229.6 × 100 = 1.5%
A change is C, I, NX, G will cause
What is a change in Aggregate Demand
The United States GDP falls shorts by $75 million. Their current MPS is 25%. How much and how could they change in Taxes AND Government spending to reach this goal?
Decrease taxes by $25 million
Increase spending by $18.75 million
What happens to exports and imports when a currency appreciates?
What happens to exports and imports when a currency depreciates?
Appreciate- Exports decrease, imports increase
Depreciate- Exports increase, imports decrease
What is ailurophobia? (Hint: Mr. McD has 3 and would lose these 3 if he developed this fear)
Fear of cats