macro economics
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- Created by: amit
- Created on: 21-04-15 21:22
If total output is calculated by adding up the market value of goods and services produced, then more expensive items:
receive a higher weighting than cheaper items.
1 of 35
The greater demand for paid childcare services as women's labour force participation increases represents primarily:
a switch from non-market to market production.
2 of 35
The value added by any firm equals the firm's ______ from selling the product minus _______.
revenue; the cost of inputs purchased from other firms
3 of 35
People who enjoy high standards of living usually have all of the following EXCEPT:
freedom from scarcity.
4 of 35
When economists use market values to aggregate output, they sum the:
price times the quantity of each item produced.
5 of 35
The measure of the cost of a standard basket of goods and services in any period relative to the cost of the same basket of goods and services in the base year is called the:
consumer price index.
6 of 35
A situation of negative inflation is called:
deflation.
7 of 35
All of the following are nominal quantities EXCEPT the:
number of new houses built in one month.
8 of 35
Deflating a nominal quantity is the process of dividing a ____ quantity by a ______ in order to express the quantity in ______ terms.
nominal; price index; real
9 of 35
The nominal interest rate equals the
real interest rate plus the inflation rate.
10 of 35
The unemployment rate equals the number of people:
unemployed divided by the labour force.
11 of 35
People who would like to work full time, but are able to find only part-time work are officially counted as:
employed.
12 of 35
Cyclical unemployment is:
the extra unemployment that occurs during periods of recession
13 of 35
Who of the following would be counted as unemployed?
A person willing to work who has looked for a job in the preceding week
14 of 35
Frictional unemployment is:
short-term unemployment that is associated with the process of matching workers with jobs
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In Macroland potential GDP equals €500 billion and real GDP equals €515 billion. Macroland has a(n) _________ gap equal to _____ percent of potential GDP.
expansionary; -3
16 of 35
The key assumption of the basic Keynesian model is that in the short run firms ______.
meet demand at preset prices
17 of 35
The tendency of changes in asset prices to affect spending on consumption goods is called the _____ effect.
wealth
18 of 35
If consumption increases by €9 when after-tax disposable income increases by €10, the marginal propensity to consume equals:
0.9
19 of 35
In the Keynesian cross diagram the 450 line represents the short-run equilibrium condition that:
Y = PAE
20 of 35
Banks hold reserves:
to meet depositor withdrawals and payments
21 of 35
If the actual reserve/deposit ratio equals 8% and the desired reserve/deposit ratio for this bank is 10%, the bank should:
stop making loans.
22 of 35
The two main responsibilities of the European Central Bank are to _____ and to ______.
conduct monetary policy; oversee financial markets
23 of 35
When the central bank buys €1,000,000 worth of government bonds from the public, the money supply:
increases by more than €1,000,000.
24 of 35
The money demand curve will shift to the left if
the price level decreases.
25 of 35
an decrease in the interest rate ______ IS curve
causes a movement along the
26 of 35
An increase in money demand caused by an increase in income ______ the LM curve
causes a movement along
27 of 35
In the equation Md = kY - hi, where Md is money demand, the parameter k captures _____
the transactions demand for money
28 of 35
A higher equilibrium Y and a lower equilibrium i are best explained by _____
an increase in the money supply
29 of 35
A decrease in the money supply leads to a _____ equilibrium value of ______
higher: i
30 of 35
An increase in the value of a currency relative to other currencies is called a(n):
appreciation.
31 of 35
The real exchange rate is the:
price of the average domestic good or service relative to the price of the average foreign good or service, when prices are expressed in terms of a common currency
32 of 35
If a certain automotive part can be purchased in Poland for 32 zloty or in Germany for €5.25 and if the nominal exchange rate is 8 zloty per euro, then the automotive part:
is more expensive in Germany
33 of 35
The demand for Swiss francs in the foreign exchange market equals 11,000 - 25,000 e and the supply of Swiss francs in the foreign exchange market equals 9,000 + 25,000 e, where e is the nominal exchange rate expressed in U.S. dollars per franc. The f
25;.04
34 of 35
A decrease in the official value of a currency in a fixed-exchange-rate system is called a(n):
devaluation
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Other cards in this set
Card 2
Front
The greater demand for paid childcare services as women's labour force participation increases represents primarily:
Back
a switch from non-market to market production.
Card 3
Front
The value added by any firm equals the firm's ______ from selling the product minus _______.
Back
Card 4
Front
People who enjoy high standards of living usually have all of the following EXCEPT:
Back
Card 5
Front
When economists use market values to aggregate output, they sum the:
Back
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