Macroeconomics Review

If the Federal reserve and Government are attempting to encourage growth and stimulate the economy, which actions would each take?  (monetary and fiscal)

• increase the Required reserve / increase government spending
• sell government securities / decrease taxes
• decrease the interest rate / increase government spending
• buy government securities / decrease government spending

If real gross domestic product is declining, the economy is most likely experiencing which of the following?

• increasing unemployment

• negative long-run economic growth

• inflationary pressures

• an increase in aggregate demand

• a recovery

What is inflation?

• rise in all prices
• rise in most prices
• rise in some prices
• rise in general prices

Which of the following is a monetary policy action used to combat a recession?

• cutting taxes
• increasing the money supply
• decreasing the money supply
• raising taxes

Taxing & spending to help the economy grow is referred to as

• expansionary policy
• monetary policy
• contractionary policy
• budget deficit

What does NAFTA stand for?

• North American Federation Trading Act

• North America Fur Trade Agreement

• North America Free Trade Agreement

• Northern Africa Free Trade Act

Taxing & spending to slow the economy is referred to as 

• budget surplus 
• monetary policy
• contractionary policy
• budget deficit

A monopoly is when:

• One seller/business dominates an industry.

• A few sellers/businesses dominate an industry.

• Supply exceeds demand.

• A business offers special gifts and coupons.

Check all that apply: Which of the following are characteristics of a perfectly competitive market?

• Many buyers/sellers

• Identical Products

• Price Makers

• Low barriers of entry

NAFTA is an agreement between all of the following countries EXCEPT

• United States
• Mexico
• Great Britain
• Canada