Economic Indicators, The Fed, Monetary Policy & Fiscal Policy

Which term replaces the question mark? Consumption + Investment + Government + Net Exports = ______?

• Disposable Personal Income

• Gross Domestic Product

Which term completes the list? The Five Stages of ______? 1. Growth 2. Peak 3. Recession 4. Trough 5. Recovery

• the Annual Budget

• the Business Cycle

Inflation would benefit which group of people the most?

• people on fixed incomes

• people who are in debt

Which economic indicator best shows that deflation is occurring?

• a decrease in interest rates due to home foreclosures

• a decline in prices due to the lack of consumer spending

During a period of economic downturn, what is one characteristic that might be observed in the job market?

• unemployment tends to rise

• prices tend to rise

Quinton and Cam are studying the economy and notices a period when the real gross domestic product (GDP) stops falling. Which stage of the business cycle are they observing?

• Expansion

• Recession

• Trough

Alex and Payton are studying the economy for their class project. They want to know, during which stage of the business cycle does the economy experience the highest inflation rate?

• Peak

• Trough

Harley noticed that her country's unemployment rate increased to 12%. Inflation grew at an average of just 0.4%. Where is this country in the business cycle?

• Recession

• Trough

Which option best matches a gross domestic product (GDP) trend with a stage in the business cycle?

• decreasing GDP growth – period following a trough

• accelerating GDP growth – period of expansion

Which statement describes the relationship between the consumer price index (CPI) and the business cycle?

• The CPI decreases during periods of contraction.

• The CPI increases during periods of contraction.