Earlier AP Macro Things
Earlier AP Macro Stuff t
That Came Later
AP Macro Stuff Your Probably Forgot
Later AP Macro Things
Latest AP Macro Stuff
100
The primary emphasis in macroeconomics is on: (A) how firms set prices. (B) the national economy. (C) marginal analysis. (D) bits and pieces of the economy. (E) the employment of individual workers.
B - the national economy.
100
A period of falling real gross domestic product is an indicator of a(n)...? peak? expansion? recession? recovery? trough?
RECESSION.
100
Japan, at the point at which it is currently producing, must give up the production of 75 computers to produce 25 additional cellular telephones. Which of the following is the opportunity cost of producing 3 computers?
1 cellular telephone. (1 costs 1/3 phone so 3 = 1 whole)
100
If the aggregate consumption function is C = $100,000,000 + 0.75 x YD, where YD is equal to the disposable income less the current tax rates, then the marginal propensity to save is?
0.25
100
Define the "crowding out" process (specifically).
When governments need to spend as part of a budget deficit, they borrow money, increasing the interest rates, therefore "crowding out" investors (who now have higher interest rates) from doing their own private investment loans.
200
Although water is very abundant in most places, it is scarce because?
there is not enough of it to meet all needs at zero cost.
200
When overall price levels lower over time, this is referred to as?
Deflation
200

CIGX stand for what?

Consumption(consumer spending), Investment (spending), Government (spending), & Net Exports (exports-imports).

200
A decrease in aggregate demand will generate a(n) __________ (increase/decrease/no change) in real GDP and a(n) __________ (increase/decrease/no change) in the price level in the short run.
Decrease ; Decrease
200
If inflation increases from 2% to 5%, the money demand curve will... (movement?)
Shift to the right (multiple reasons... precautionary against further inflation, speculation against further increases...money now to spend as opposed to save and lose savings... in all of these people DEMAND more cash on hand because it's safer/more reliable).
300

Captain America is offered a free ticket to the opera, but he has a meeting with the Avengers at the same time. His opportunity cost of going to the opera is?

The meeting with the Avengers

300
On a production possibilities curve, a point outside the curve is said to be _________________, while a point inside the curve is said to be _________________.
Unattainable ; inefficient
300
The most likely effects of tariffs and/or quotas are to ________ (raise/lower?) prices and to ________ (raise/lower?) consumption of the protected goods in the importing country.
Raise ; Lower
300

The Federal Funds rate is the interest rate at which...?

Banks borrow excess reserves from other banks.

300
Given an inflationary gap, the Fed will use monetary policy to _________ (increase/decrease) real GDP and ___________ (increase/decrease) the price level.
decrease / decrease
400

"Unemployment decreased to its lowest level in 10 years last month." This statement is an example of which of the following: absolute statement, value statement, positive statement, normative statement, scientific method.

Positive Statement

400
The U.S. Production Possibility curve will _________ (movement?) if there is a large influx of immigrants.
Shift outward (change in Quantity/Quality of resources - labor - more of)
400
When the price of lamps increases, the ______(supply/quantity supplied) then _________ (increases/decreases).
Quantity Supplied, Increases
400
If the Federal Reserve wants to discourage banks from borrowing directly from the Fed and thus decrease the monetary base, the Fed would likely _________ (increase/decrease) the _______________ (discount rate/federal funds rate/RRR/sell US Treasury bills in an OMO).
increase ; the discount rate
400
A reduction in interest rates due to an increase in the money supply will shift _____________ (AD/SRAS/LRAS) to the _______ (left/right).
AD to the Right (investment spending will increase, which will then cause SRAS to increase, which will EVENTUALLY cause LRAS to increase... but the initial change is just AD to the right).
500
A new startup airline is offering free round-trip tickets to anywhere to the first 600 people who enter the office on the airline's first day of business. You arrive 24 hours before they are scheduled to open to be sure to get the free tickets, and you buy food from vendors while waiting in line. The cost of the tickets to you is?
The cost of the food while you waited in line + the opportunity cost of your time.
500
Assuming you have a PPC showing the relationship between capital goods and consumer goods for a given country, technological improvements to capital good will likely result in what...& why?
An outward shift of the PPC, as capital goods and consumer goods both increase because capital goods are used to create consumer goods and capital goods are now produced more efficiently leading to larger consumer good production as well.
500
Suppose the real interest rate is 2.1% and the nominal interest rate is 5.4%. Then the expected inflation rate is?
3.3% (nominal rate - real rate = inflation rate).
500
All other things unchanged (aka, ceteris paribus), a decrease in the value of the dollar against the euro _____________ (increases/decreases) U.S. net exports and shifts the aggregate demand curve to the _____________ (left/right).
increases ; right
500
In the absence of international capital flows, the equilibrium interest rate in the US market for loanable funds is 3% while in Germany it is 7%. International borrowing and lending between the US and Germany may result in a common interest rate of __________ and capital (inflow/outflow) from the ____________ (US/Germany) to _________ (US /Germany).
4% ; OUTFLOW ; US ; Germany (7-3 = 4, money is leaving the US (outflow) and matching the German inflow.)
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