10/9 @4 Economic Concepts Quiz

A decrease in the value of money or currency is called ____.

• recession

• stagnation

• economic instability

• deflation

• inflation

The economic recession of 2007–2009 was partly caused by the burst of what was called the "housing bubble". This phrase means that ____.

• builders of real estate began to build new homes everywhere without considering the market

• the U.S. population increased and mortgage companies began a huge advertising campaign to get more people to buy homes

• the prices of homes went up during a time when the supply was limited, and then these prices later decreased

• people began to buy more homes because of the increasing cost of renting property

Imagine that a large asteroid crashed into a remote area of Arizona, causing a huge explosion that spread ash and debris into the atmosphere for hundreds of miles around. This caused a shutdown of many businesses and increases the incidence of respiratory illness in thousands of U.S. citizens. Soon after, there is a huge economic recession due to this ____.

• economic natural disaster

• apocalyptic phenomenon

• statistical outlier

• black swan event

A measure of economic growth that represents all of the production and consumption of goods within a nation is called the ____.

• industrial product price index

• gross domestic product

• basis point

• federal interest rate

Causes of economic instability include all of the following except ____.

• a fall in home prices

• black swan events

• interest rate changes

• an increase in tourism

• government subsidies