Economics Definitions and Key Concepts

Fill in the blank: Investment is spending on _______ to increase future production (e.g., machinery, factories).

• capital goods

• consumer goods

• services

• raw materials

Fill in the blank: Human Capital refers to the (a)   , education, and health of workers that improve productivity.

Which of the following is included in GDP?

• Used goods

• Consumer spending

• Financial assets

• Household production

Which of the following is NOT included in GDP?

• Government spending

• Net exports

• Used goods

• Investment

Stagflation is a situation with high inflation and high unemployment, usually from supply shocks.

• True

• False

Fill in the blank: Cost-push inflation occurs when prices rise due to increased ______ costs.

• production

• consumption

• advertising

• distribution

Fill in the blank: Demand-pull inflation occurs when prices rise due to excess ______.

• demand

• supply

• taxation

• production

Which of the following is an example of fiscal policy?

• Adjusting money supply

• Adjusting spending and taxes

• Setting interest rates

• Printing money

Which of the following is an example of monetary policy?

• Federal Reserve adjusts money supply and interest rates

• Government increases taxes

• Government increases spending

• Government borrows money

Fill in the blank: The velocity of money is the number of times money is ______ in a year.

• spent

• saved

• printed

• borrowed