Macroeconomics 1
What policy tool was emphasized by Keynes?
Fiscal
What kind of inflation is caused by rising production costs?
Cost-push
What kind of inflation is driven by high demand?
Demand-pull
What part of the economy includes households and firms?
Private sector
What occurs once in a lifetime, twice in a moment, but never in a hundred years?
M
What does the term “business cycle” refer to?
Economic ups and downs
Why might printing more money not solve poverty?
Causes inflation
If the government spends more than it earns, what is that called?
Budget deficit
Which sector produces the most GDP: households, firms, or government?
Firms
What can travel around the world while staying in one spot?
Stamp
What are the three approaches to calculating GDP?
Output, income, expenditure
What is the role of the Federal Reserve (or central bank) in the economy?
Money regulation
What are the main goals of macroeconomics?
Growth, employment, price stability
Which policy is better in a liquidity trap: fiscal or monetary?
Fiscal
The more you take, the more you leave behind. What am I?
Footsteps
What’s the risk of expansionary policy near full employment?
Overheating (inflation)
Explain how exchange rates can affect a country's exports and imports.
Weak currency boosts exports
Why might a government devalue its currency intentionally?
Boost exports / reduce trade deficit
Which is bigger: GDP or GNP for a country with many citizens working abroad?
GNP
What is always coming but never arrives?
Tomorrow
Why might an economy experience inflation even during high unemployment?
Due to supply shocks or cost-push inflation (e.g., rising oil prices).
. What happens if monetary policy is tightened but inflation is due to supply shocks?
Output falls, inflation stays
What’s crowding out in macroeconomics?
Private spending falls
Why might tax cuts not boost GDP in the long run?
Low multiplier
If today is Monday, what day of the week will it be in 100 days?
Wednesday,100 ÷ 7 = 14 weeks and 2 days. So, 2 days after Monday is Wednesday.