GDP/ Inflation
What macroeconomic concept do economists use to measure economic growth?
Gross Domestic Product
Looking at the following photo, label EACH roman numeral
I. Peak
II. Contraction
III. Trough
IV. Expansion
What is the main purpose of enacting a monetary policy?
to control the supply of money in circulation by manipulating interest rates
A government deficit is the result of
What is a regressive tax?
If there was a -2% change in the CPI between 2022-23, what does that mean?
There was a decrease in inflation
Someone is structurally unemployed when...
They lose their job because they lack certain skills or are replaced by technology
What led to the creation of the Federal Reserve?
If the US government cut spending but increased the tax rates, this would most likely result in a budget...
surplus
What is a progressive tax?
One in which the rich are taxed a higher percentage
Given the output expenditure model (GDP=C+I+G+(X-M)) which letter constitutes for the MOST amount of total spending?
Consumer Spending
Which of the following IS counted as unemployed?
individuals who have retired from the workforce
workers who are employed part-time and are seeking full-time jobs
workers who have lost their jobs and are seeking new employment
individuals who are not actively seeking jobs
workers who have lost their jobs and are seeking new employment
What is the dual mandate of the Federal Reserve?
Price Stability and Full Employment
The higher a countries GDP per Capita, the higher their...
citizen's standard of living
If the government cut taxes on middle and lower-class citizens, how would that help the economy?
Cutting taxes will encourage people to spend more money
How is the consumer price index measured?
By looking at the prices of goods in the market basket
Somewone who is cyclically unemployed is unemployed b because of...
a downturn in the economy
What is missing from the photo on #17 on the study guide?
The 12 Federal Reserve Banks
In order to solve the problem of inflation, the US government would pursue which type of fiscal policy? This would require them to do what to taxes and government spending?
A contractionary fiscal policy, which would require them to increase taxes and lower government spending
What type of taxes are directly linked to school funding?
Property Taxes
B Gas, Inc. operates an oil refinery in Colorado. In 2021, the company imported $2 billion worth of crude oil from Canada. Out of that crude oil, the company produced $3.5 billion worth of gasoline and $3.5 billion worth of fuel oil. B Gas, Inc. exported and sold all of the gasoline it produced to Canada and it sold all of the fuel oil domestically. The company did not produce or import any other products. What was the total value of net exports for B Gas, Inc?
$1.5 Million
When have we reached full employment in an economy (list both ways)?
When the rate is between 4%-6%//When there is no cyclical unemployment
If the Federal Funds (interest) Rate increased, what type of monetary policy is that? What if it decreased?
Increased: Contractionary
Decrease: Expansionary
In order to solve the problem of unemployment, the US government would pursue which type of fiscal policy? This would require them to do what to taxes and government spending?
An expansionary fiscal policy, which would require them to decrease taxes and increase government spending
How could the government use sales-tax to raise money while not harming lower and middle-class families?
Increase the sales tax on items only the wealthy might buy