5 Written questions
5 Matching questions
- Classical Economist
- Downward sloping demand curve
- What open market operation decreases the money supply?
- Lower price level:
- Medium of Exchange
- a -inverse relationship (negative) between the price of a good and the quantity that buyers are willing to purchase
- b Believe prices are flexible, Economy can correct itself, Soys law: supply curves demand (production matters)
- c When the fed sells bonds.
- d -increase the purchasing power of money
-Leads to a lower real interest rate, which increases consumption and investment
-make domestically produced goods less expensive relative to foreign goods
- e Money used to buy goods and services
-fiat money: money that has no intrinsic value
-More efficient to use money
5 Multiple choice questions
- shift in monetary policy designed to stimulate aggregate demand.
- average number of times a dollar is used to purchase final goods and services during a year.
- amount of money in the economy, determined by the Fed. It is vertical because it is determined by Fed policy and does not depend on the interest rate.
- direct positive relationship between the price of a good or service and amount suppliers are willing to produce
- the combination of Structual unemployment and frictional unemployment and is not fixed but affected by the structure of labor force and public policy
5 True/False questions
GDP → only counts goods and services produced within the geographic borders of a country
-does not count transfers (welfare, gifts of money)
Employed person → percentage of people in the labor force who are unemployed
Loanable funds market (Demand) → percentage of the amount borrowed that must be paid to the lender in addition to the repayment of the principle.
GNP (gross national product) → -total market value of all final goods and services produced by the citizens of a country
-counts income that americans earn abroad
-ignores the income foreigners earn in the U.S.
Transfer Payments → the combination of Structual unemployment and frictional unemployment and is not fixed but affected by the structure of labor force and public policy