How an Economy Grows: vocab and concepts-- chap. 13-15

What does word deriding mean?

• the expression of contempt or ridicule

• the expression of honor or reverence

• the expression of fear and sadness

What does enhancing mean?

• To develop a answer for an issue

• To develop a concept into a working machine

• intensify, increase, or further improve the quality,

• decrease, or further disprove the quality,

Why does the author believe that president Slippery Dickson (Richard Nixon) ended the (fish) gold standard?

• Because the president wanted to take all the gold for himself.

• Because fed notes (US dollars) are the most stable form of money

• Because there were too many gold reserves to back all the money they created.

• Because there weren't enough gold reserves to back all the money they created.

Under president Roughy Redfish (Ronald Reagan) the US economy entered a period of unprecedented prosperity. How did the president make this happen?

• He increased taxes and burdensome regulations.

• He decreased taxes and burdensome regulations.

• He went back to the gold standard

• He US the US financial system on Bitcoin.

Why was real estate considered a low-risk loan for banks?

• Banks like to buy a lot of property and sell it at much higher prices.

• Because house loans (mortgages) are rarely paid off and the house is bad collateral.

• Banks like to buy and sell houses to make profits

• Because house loans (mortgages) are usually paid off and the house is good collateral.

Since the 1980s in the US, interest rates have...

• Gone up

• Gone down

• Remained the same

Why does the author believe that rising real-estate prices is not a good measure of the economic well-being of a country?

• Because it is merely deflation of prices and it decreases the productive capacity of the country.

• Because it is merely inflation of prices and it doesn't increase the productive capacity of the country.

• When real-estate prices go up, people can afford more leisure time.

• When real-estate prices go down, people cannot afford more leisure time.

The government in the 1990s created the banks Fannie Mae and Freddie Mac to help banks give loans to those who would ordinarily be unable to afford their own house. Why does the author believe this was a terrible idea?

• Because this would interfere with the free market. In this case, it would cause house prices to inflate.

• Because the author believes that poor people should not be able to buy a house.

• Because this would not interfere with the free market. In this case, it would cause house prices to deflate.

• Because the author believes that poor people should be able to buy a house.

Why did many people start to default on their loans (2007-2009)?

• People were no longer able to repay their loans

• The government gave them too much money.

• The government made people pay too much money for their houses.

• The government spent all of its money on the Iraq war.

Why were students loans invented?

• To help more people buy their own houses.

• To help universities become richer

• To help poorer people afford a university education.

• To help richer people afford a university education.