Supply and Demand
The law of supply states that as the quantity supplied increased, prices will _______
Fall/decrease
The 2008 financial crisis was sparked by an asset "bubble" in this sector
Housing
The sum total of all of an economy's goods and services
Gross Domestic Product (GDP)
The cost of missing out on the next-best option
Opportunity cost
Your gross income refers to the amount of money your earn ___________ ___________.
Is quantity demanded exceeds quantity supplied, it is called a _________
Shortage
Schumpeter's idea that the economy naturally goes through periods of growth and contraction
The Business Cycle
Economists consider this to be a normal rate of inflation
2-3%
Economic, social, and ________ incentives motivate people's behaviors
Moral
In the 50/30/20 rules, the "30" represents _____________.
Discretionary spending (wants)
The degree to which demand for a product is affected by its price point or other economic factors
Elasticity
Buying stocks "on the margin" refers to this practice, which played a big role in causing the market crash in '29
Borrowing money to fund stock purchases
A term to refer to wages or prices with inflation factored out
"real" wages/prices
Cost-benefit analysis of producing one additional unit of something
Marginal analysis
A retirement account that takes money from your check before taxes are paid (sometimes matched by employers)
401(k)
When a business or country can produce a good at lower opportunity cost than its trading partners
Comparative Advantage
This type of unemployment refers to people who just finished school or are transition to a different career
Frictional unemployment
The machinery of a factory is an example of this factor of production
Capital
Part of the loan that represents the amount you borrowed, not the added interest.
Principal
The point at which supply and demand curves intersect is called the __________
Equilibrium price
The Smoot-Hawley Act of 1930 tried to improve the economy by implementing higher ________, but actually made the crisis worse.
Tariffs
What monetary policy would the Federal Reserve pursue if its primary concern is reducing inflation?
Raising the federal funds (interest) rate
Diminishing Marginal Returns (DMU)
A financial instrument that pools funds from many investors to purchase a diversified portfolio of securities
Mutual fund