macroeconomic aims of government
What are the two types of economic growth the government wants?
short-run growth and long-run growth
____uses spending and taxes to reach the five macroeconomic aims.
Government
True or false: commercial bank actions that change how much money is in the economy and how expensive it is to borrow.
false, central banks mange this
An inflation might be caused by:
A. demand bigger than supply
B. supply bigger than demand
C. lower costs to produce products
D. too less money in the system
A. demand bigger than supply
Why do governments cut taxes?
They want to raise spending.
Bob wants to work and has the ability to work. Is he a labour force?
Yes, he is.
If the spending exceeds the taxes received, then the situation in this country is ______
deficit
people spend way too much money this year, the central bank will ______
raise interest rates
Which of the following is true:
A. inflation is always bad
B. deflation is always good
C. prices overall go down in a deflation
D. prices overall go down in a disinflation
C. prices overall go down in a deflation
A. more people working can boost economy
B. so that they don't have to spend money to help those unemployed people to stay alive
C. the country will look better
D. people should work
D. people should work
last year it costs 4.5RMB per kilogram of apples, this year the price increased to 4.7RMB per kilogram. Has it met the government's aim of price stability
yes, it has.
the price of apples only increased by 2%
Which is not a reason why governments spend:
A. to fix a road
B. to build a playground
C. to provide ice cream for everyone
D. to enjoy the happiness of spending money
D
If people in a country spend way too less, the central bank might _______
cut interest rates
if an apple that costed 2RMB last year costs 6RMB this year, it is a(n) _________.
inflation
If there is inflation in a country, the ______ should ____.
central bank; raise interest rates
If a country earned 120000RMB on exports in 2021, 120500RMB in 2022, 120503RMB in 2023, 130000RMB in 2024, and it spended 376000RMB on imports in 2021, 378000RMB in 2022, 378500RMB in 2023, 378600RMB in 2024, what happens?
A. nothing happens, the government ignores it and keeps spending
B. citizens enjoy more imports
C. the country owes a huge debt
D. there is a surplus in products
C. the country owes a huge debt
In a country, many people smoke and suffer from lung diseases. As the government of the country, what won't you do to decrease smoking rate?
A. raise taxes on cigarettes
B. decrease people's income
C. advertise the harms of smoking
D. ban smoking
B. decrease people's income
A central bank can:
A. lend money
B. enable payments
C. accept deposits
D. create new money
D. create new money
this the cost of an apple in five years:
2020: 2RMB
2021: 3RMB
2022: 4RMB
2023: 5RMB
2024: 5.5RMB
This is a(n):
A. inflation
B. deflation
C. disinflation
C. disinflation
True or false: there is some inflation in the market means the government doesn't reach its goal of price stability.
false, steady inflation rate around 2% is good
Which is an example of how governments move money from richer people to poorer people:
A. provide expensive ice cream for everyone in the country
B. provide expensive education
C. raise taxes on poor people and use it to help rich people
D. raise taxes on rich people and use it to help poor people
D. raise taxes on rich people and use it to help poor people
Why do some countries put lower taxes on rich people and higher taxes on poor people?
To attract rich people to come to the country and increase the total economy.
Which is not an effect of a central bank increasing interest rates:
A. people don't want to borrow
B. people want lend
C. people want to borrow
D. loans cost more
C. people want to borrow
If there is bad deflation happening in a country, how to deal with it:
A. cut taxes
B. reduce income
C. increase taxes
A. cut taxes
Which of the following belongs to Fiscal Policy and which belongs to Monetary Policy:
A. raise income taxes
B. cut interest rates
C. encourage banks to lend more
D. create new money
E. spend to provide free education for citizens
F. pay interest on money borrowed in earlier years
Fiscal Policy: a, e, f
Monetary Policy: b, c, d