Macroeconomics review (EOC)

What is the formula for GDP?

• C + I + G + (X-M)
• C + I + G / (X-M)
• C + I + G + (population)
• C + I + G + (M-X)

Which letter represents the Contractionary (Recession) Phase?

• A
• B
• C
• D

Where on the business cycle would you find the highest unemployment?

• A
• B
• C
• D

What can the government do to give a boost to a slowing economy?

• raise taxes

• lower taxes

• increase interest rates

• buy government bonds/securities

Who is most likely to be hurt by inflation?

• someone who borrowed money
• a retiree on a fixed income
• a business owner
• the U.S. government

What type of unemployment did people experience during the Great Depression?

• Seasonal
• Structural/Technological
• Cyclical
• Frictional

A literary editor leaves her job in New York to look for a new job in San Francisco.

• Frictional
• Cyclical
• Structural
• Not counted

Which result occurs when federal government expenditures are greater than the federal government's total receipts?

• reduced net exports
  
• increased excise taxes
  
• a federal budget surplus
  
• a federal budget deficit

The federal government uses government spending and tax rates to help control recessions and encourage economic activity. This is called

• fiscal policy
• monetary policy
• supply-side economics.
• open market operations.

When the Federal Reserve sells government securities on the open market, what effect does this action have on the nation’s money supply and interest rates?

• Money Supply - Decreases / Interest Rates - Increase
• Money Supply - Increases / Interest Rates - Increase
  
• Money Supply - Decreases / Interest Rates - Decrease
  
• Money Supply - Increases / Interest Rates - Decrease