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ECN 211 Final Exam review
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ECN 211 Final Exam review
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ECN 211 Final Exam reviewentails the exchange of goods for goods - ANS-Barter
all the possible combinations of two goods that can be purchased, given money income
and the prices of the goods - ANS-The budget line shows?
leftward shift in the economies aggregate demand curve - ANS-A contractionary fiscal
policy is shown as a:
Their face value is greater than their intrinsic value - ANS-To say that coins are "token
money" means that:
Cause and effect chain of an expansionary monetary policy - ANS-An increase in the
money supply will lower the interest rate, increase investment spending and increase
aggregate demand and GDP... this is an example of
Medium of exchange - ANS-the transaction demand for money is most closely related to
money functioning as a
Difference between actual reserves and required reserves - ANS-excess reserves refer
to the
excess reserves - ANS-The amount that a commercial bank can lend is determined by
its
the governments ability to control the supply of money and therefore to keep its value
relatively stable - ANS-The money supply is back by:
-Store value
-unit of account
-medium of exchange - ANS-Money functions as a
Increasing government spending by 4 billion - ANS-If the MPS in an economy is .1,
government could shift the aggregate demand curve rightward by $40 billion by
Budget deficit - ANS-the amount by which government expenditures exceed revenues
during a particular year is the
, Discount rate - ANS-the interest rate at which the Federal Reserve banks lend to
commercial banks is called the
Federal Open market committee (FOMC) - ANS-The group that sets the federal
reserves system policy on buying and selling government securities (bills, notes, and
bonds) is the :
Tax cuts during recessions and reduction in government spending during inflation -
ANS-An economist who favors smaller government would recommend
Required reserves to its checkable deposit liabilities - ANS-The reserves ratio refers to
the ratio of a banks
1/(1-mpc) - ANS-The multiplier can be calculated as
A tax on an imported good - ANS-A tariff can best be described as
rose by 3 % - ANS-in 2010, tatums nominal income rose by 4.6 percent and the price
level rose by 1.6 percent. We can conclude that tattoos real income :
(r) is greater than (i) - ANS-If the real interest rate in the economy is (i) and the
expected rate of return from additional investments is (r), then more investment will be
forth coming when.
1.0 minus .4 - ANS-with a marginal propensity to save .4, the marginal propensity to
consume will be
An increase in investment can cause GDP to change by a larger amount - ANS-the
multiplier effect means that
Recession - ANS-The phase of the business cycle in which real GDP declines is called
a
True - ANS-True OR False
If the MPC is .9 and investment spending increases by $20 billion, real GDP will
increase by $200 billion
exports minus imports - ANS-Net exports are
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