The market value of all final goods and services produced within a country during a time period.
What is GDP?
100
A situation with high unemployment, low output, and low prices.
What is a recession?
100
The use of government spending and taxation to influence the level of economic growth and inflation.
What is Fiscal Policy?
100
Money that is not backed by any other good (like gold).
What is fiat money?
100
This is the reason why countries export goods.
What is "hvaing a comparative advantage in production"?
200
The price level of consumer goods and services that a household purchases to the prices of those goods and services purchased in a base year.
What is CPI?
200
This is what happens to the economy in the long-run in an inflationary gap.
What is resource prices adjust upward causing higher inflation?
200
This indirectly affects real GDP by changing consumption.
What is taxes?
200
The ability of an asset to be exchanged for goods and services.
What is liquidity?
200
A type of trade restrictions that make domestic producers better off because they can sell more goods at higher price and the government collects extra revenue from taxes.
What is a tariff?
300
The type of unemployment caused by changes in the business cycle.
What is cyclical unemployment?
300
This is what happens to the economy when the government keeps a balance-budget during a recession.
What is makes the economy go into a deeper recession?
300
These 2 components of real GDP are affected by fiscal policy.
What is government spending and consumption?
300
If the reserve requirement is 25 percent, this amount is the money multiplier.
What is 4?
300
A free trade situation where the domestic consumer is better off and the domestic producer is worse off.
What is being an importer?
400
The maximum sustainable output of the economy given its resources.
What is the potential output?
400
If these 2 problems happen simultaneously, fiscal and monetary policy cannot solve both.
What is high inflation and high unemployment?
400
Domestic investment is reduced when this happens. (a side effect of fiscal policy)
What is the crowding out effect?
400
The Fed can increase money supply by doing this to the required reserve.
What is decreasing the required reserve?
400
This is the arguments in support of trade restrictions limiting domestic dependence on foreign suppliers of petroleum and aircraft.
What is the national defense argument?
500
These things will most likely occur during the expansionary phase of a business cycle.
What is increase in output, decrease in unemployment, and increase in price level (inflation)?
500
The reason why expansionary policies are more popular.
What is dynamic inconsistency?
500
Unemployment insurance and the progressive tax system is a type of this.
What are automatic stabilizers?
500
These 3 markets are affected when monetary policy is conducted.
What is the money market, loanable funds market, and the goods & services market?
500
This is the situation when the sale of a good by a foreign supplier in another country at a price below that charged by the supplier in its domestic market.