Exam 1
The production possibilities frontier is..
What is the trade-off between the efficient production of two different goods?
What is inflation?
This is GDP expenditures
What is C + I + G + NX?
Many depositors attempt to withdraw funds from a bank at one time.
What is bank run?
This mean "additional"
What is marginal?
Goods produced abroad and sold domestically are called
What is imports?
Which determinants shift the AD curve
What is Consumption (real wealth, expectations, taxes), Investment (investor confidence), Govt. Spending (policy changes), and International Trade (income abroad)?
With the AD-AS graph, what variable is on the vertical and horizontal axis?
What is vertical - price level
What is horizontal - real GDP
The primary single tool of monetary policy
What is open market operations?
The opportunity cost of going to school rather than working is the cost of
What is potential wages?
Name one thing that is not included in GDP
What is the sale of used goods/services or goods/services produced in previous years or financial instruments(bonds/stocks) or items produced in a foreign country?
The type of tax system in place in the US
What is progressive tax system?
Costs of inflation
1.Shoe-leather costs
2.Money illusion
3. Menu costs
How banks create money
What is lending out deposits to borrowers?
No matter what you have to give up something?
What is opportunity cost?
Results in a more efficient use of resources.
What is specialization?
The formula for computing the past prices/money values to today's dollars
What is (the value in past) X (CPI today/CPI past)?
These cause the production possibilities frontier to shift to the right
What is an increase in resource availability, improvement in technology or existing resources?
How is an increase in government spending or a decrease in taxes if financed...
What is borrowing?
Name the two agents and markets in the circular flow model
What is firm and household and resource and product market?
Samantha quit her job at the landscaping company and has been trying to get hired at Home Depot, but has not received a reply to her application
What is frictional unemployment?
The LRAS is vertical because?
What is it is not affected by the price level, it depends on resources, technology, and institutions?
Describe the deficits effects on expansionary and contractionary fiscal policy
What is expansionary FP - deficit will grow and contractionary FP - deficit will shrink?
The 3 responsibilites of the Fed
What is monetary policy, central banking, and banking regulation?