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Worksheetsfinal macro
Total questions: 96
Worksheet time: 1hrs 3mins
shareholders
entitled to a share of the company's profit. When profits are paid directly to shareholders the payment is called a dividend
due to fluctuations in stock prices and housing prices
households feel richer and spend more
describes both monetary and fiscal policy, the goals of which are to smooth out fluctuations in output and employment and to keep prices as stable as possible
capital gain
the government deficit
the time It takes to put the desired policy into effect once economist and policymakers recognize that the economy is in a boom or a slump
an increase in the value of an asset
the gain that occurs when the owner of an asset actually sells it for more than he or she paid for it
realized capital gain
embodied technical change
the gain that occurs when the owner of an asset actually sells it for more than he or she paid for it, total return that an owner of a share of stock receives is the sum of the dividend received.
Spain and Italy
the record of a country's transactions in goods, serves, and assets with the rest of the world
The larger the expected future dividends the .....
discounted value of its expected future dividends
index based on the stock prices of 30 actively traded large companies
households feel richer and spend more
Larger the current stock price, other things being equal
The price of a stock should equal
an increase in the ratio of capital to labor
the discounted value of its expected future dividends
disembodied technical change
is registered as a debit in the capital account and it increases private U.S assets abroad
what do stock prices depend on
an index based on the stock prices of 30 actively traded large companies
Index based on the stock prices of 500 of the largest firms by market value
what people expect others to expect them to be in the future, bringing about stock market "bubbles"
much of the recession was driven by the fall in housing and stock prices which are difficult to predict
Dow Jones Industrial Average
index based on the stock prices of 500 of the largest firms by market value
an index based on the stock prices of 30 actively traded large companies
A Index based on the stock prices or more than 5000 companies traded on the NASDAQ stock market
ur mom
NASDAQ Composite
Index based on the stock prices or more than 5000 companies traded on the NASDAQ stock market
because it takes time for the government spending multiplier to reach its full value, there is a lag between the time a fiscal policy action is initiated and the time the full change in GDP is realized
the time It takes to put the desired policy into effect once economist and policymakers recognize that the economy is in a boom or a slump
the growth rate of output per person in the economy the growth rate of output per person in the economy
Standard and Poor 500
a certificate that certifies ownership of a certain portion of a firm
moderate the recession
Index based on the stock prices of 500 of the largest firms by market value
an increase in the ratio of capital to labor
What caused fluctuation in households wealth in the past ?
the government deficit
household feel richer and spend more
may increase investment
stock prices and housing prices
when housing and stock values rise what happens
households feel richer and spend more
may increase investment
delays in the economy response to stabilization policies
negative long run consequences
A increase in stock prices lead too
decrease stock
increased dividends
decreased investment
increased investment
stabilization policy
the time it takes for policy makers to recognize the existence of a boom or a slump
the time It takes to put the desired policy into effect once economist and policymakers recognize that the economy is in a boom or a slump
describes both monetary and fiscal policy, the goals of which are to smooth out fluctuations in output and employment and to keep prices as stable as possible
exchange rates are determined by making prices of similar goods equal in different countries. If one country has much higher inflation than another, its currency usually loses value compared to the other country's currency
time lags
delays in the economy response to stabilization policies
the equilibrium exchange rates occurs at the point which the quantity demanded of a foreign currency equals the quantity of that currency supplied
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
If the costs of transportation are small,the price of the same good in different countries should beroughly the same
recognition lag
Japan and china
the record of a country's transactions in goods, serves, and assets with the rest of the world
balance of payments
the time it takes for policy makers to recognize the existence of a boom or a slump
implementation lags
the time it takes to put the desired policy into effect once economist and policy makers recognize that the economy is in a boom or a slump
because it takes time for the government spending multiplier to reach its full value, there is a lag between the time a fiscal policy action is initiated and the time the full change in GDP is realized
the growth rate of output per worker
negative long run consequences
response lags
the sum of income from exports of goods and services and income rom investments and transfers minus payments for imports of goods and services and payments for investment and transfers
the discovery represents an intention and the finding of a use for the adhesive represent an innovation
the time it takes for the economy to adjust to the new conditions after a new policy is implemented , the lag that occurs because of the operation of the economy itself
The things that influence how much households and businesses spend also affect how much people buy from other countries. This includes both things people use and things they invest in. Additionally, whether domestic or foreign goods are cheaper affects how much people buy from other countries
response lags for fiscal policy
of essentially fixed exchange rates under which each country agreed to intervene in the foreign exchange market when necessary to maintain the agreed upon value of its currency
because it takes time for the government spending multiplier to reach its full value, there is a lag between the time a fiscal policy action is initiated and the time the full change in GDP is realized
The things that influence how much households and businesses spend also affect how much people buy from other countries. This includes both things people use and things they invest in. Additionally, whether domestic or foreign goods are cheaper affects how much people buy from other countries
When prices go up in one country, it can cause prices to rise in other countries too. Then, those higher prices overseas can loop back and push prices even higher in the first country
Response lags for Monetary Policy
- was the major system of exchange rate determination.• All currencies were priced in terms of gold, with an ounce of gold worth a lot in each currency.
-The gold standard implied that a country had little control over its money supply. When major new gold fields were discovered, the world's supply of gold increased.
exchange rates that are determined by the unregulated forces of supply and demand
balance of payments
the response lags are even longer . when interest rates change the sales of firms do not change until households change their consumption spending or firms change their investment spending
what is one consequence of a governments decision to stimulate the economy through tax cuts or spending increases?
the government deficit
the federal policy
a dividend
they rise
Describe the nature of deficits during recessions according to economic theory.
negative long run consequences
they are temporary and don't impose any long-run problems
positive
an increase in real GDP per capita
deficits at full employment have what consequences
a certificate that certifies ownership of a certain portion of a company
-new techniques of production
-innovation
-better educated workforce
embodied technical change
negative long run consequences
Gramm-Rudman-Hollings Act
-has undesirable macroeconomic consequences
-requires cuts in spending or increases in taxes when economy is experiencing problems
-policy makers around the glove will have to devise other methods to control growing structural deficits
the growth rate of output per person in the economy
the absence of increases in the capital stock as labor increases, less and less output will be added by each new worker
-passed by U.S congress
-this law is set out to reduce the federal deficit by 36 billion per year with a deficit of zero
automatic destabilizers
moderate the recession
revenue and expenditure items in the federal budget that automatically change with the economy like to destabilize GDP
wealth and consumption fall
the growth rate of output per person in the economy
Deficit Targeting
-has undesirable macroeconomic consequences
-requires cuts in spending or increases in taxes when economy is experiencing problems
-policy makers around the glove will have to devise other methods to control growing structural deficits
the discovery represents an intention and the finding of a use for the adhesive represent an innovation
-new techniques of production
-innovation
-better educated workforce
a country's exports of goods and services minus its important of goods and services
output growth
the growth rate of the output of the entire economy
the growth rate of output per person in the economy
growth rates of less developed countries will exceed the growth rates of developed countries ,so the less developed countries could catch up
the growth rate of output per worker
per capita output growth
the growth rate of output per person in the economy
the growth rate of output per worker
the growth rate of the output of the entire economy
labor productivity growth
the growth rate of the output of the entire economy
the growth rate of output per person in the economy
the growth rate of output per worker
catch-up
mathematical relationship stating that total GDP output depends on the total amount of labor used and the total amount of capital used
investment in enterprises made in a country by residents outside that country
growth rates of less developed countries will exceed the growth rates of developed countries ,so the less developed countries could catch up
convergence theory
moderate the recession
per-capita output growth
the demand for the us exports depends on economic activity in the rest of the world as-well as on the prices of US goods relative to the price of rest of the world goods
idea that gaps in national incomes tend to close over time
aggregate production function
mathematical relationship stating that total GDP output depends on the total amount of labor used and the total amount of capital used
The fall in value of one currency relative to another.
When prices go up in one country, it can cause prices to rise in other countries too. Then, those higher prices overseas can loop back and push prices even higher in the first country
consumption, saving, and imports equals $450
diminishing returns
households feel richer and spend more
due to fluctuations in stock prices and housing prices
an index based on the stock prices of 30 actively traded large companies
the absence of increases in the capital stock as labor increases, less and less output will be added by each new worker
Foreign Direct Investment
countries with poor institutions, corruption, investors struggle to attract capital
the use of new knowledge to produce a new product or a existing product more efficiently
investment in enterprises made in a country by residents outside that country
wealth and consumption fall
Fragile countries
countries with poor institutions, corruption, investors struggle to attract capital
the discovery represents an intention and the finding of a use for the adhesive represent an innovation
rises; go up
equation - IM=mY
technical change that results in an improvement in the quality of capital
embodied technical change
a certificate that certifies ownership of a certain portion of a firm
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
If the costs of transportation are small,the price of the same good in different countries should beroughly the same
technical change that results in an improvement in the quality of capital
Stock
the sum of income from exports of goods and services and income rom investments and transfers minus payments for imports of goods and services and payments for investment and transfers
a certificate that certifies ownership of a certain portion of a firm
the change in imports caused by a 1$ change in income
xthe demand for the us exports depends on economic activity in the rest of the world as-well as on the prices of US goods relative to the price of rest of the world goods
disembodied technical change
technical change that results in a change in the production process
all currencies other than the domestic currency of a given country
a country's exports of goods and services minus its important of goods and services
occurs when a country's exports of goods and services are less than its imports of goods and services
Invention
borrow money
an advance in knowledge
a dividend
wealth and consumption
Innovation
an increase in the ratio of capital to labor
disembodied technical change
the use of new knowledge to produce a new product or a existing product more efficiently
a country's exports of goods and services minus its important of goods and services
a firm issues bonds too
lose money
borrow money
gain money
they rise
the annual cash flow received by investors from a stock issue is called
balance of payments
drive up ; drive down
stock loss
a dividend
when there is a stock market crash what happens
wealth rises
consumption rises
wealth and consumption fall
wealth and consumption rise
usually asset values (a) during economic expansions
when the owner of an asset sells it for more than she paid for it she has a (a)
if the US treasury is forced to sell bills and bonds to the US public to finance deficits, this may ______ the price of bonds and _______ the interest rates on the bonds
(a)
the economic impact of automatic stabilizers during recessionary periods is to
taxes rising in an expansion
the discovery represents an intention and the finding of a use for the adhesive represent an innovation
exports
moderate the recession
an example of automatic stabilizers is
taxes rising in an expansion
Gramm Rudman hollings act
net taxes rise
the implementation lag for fiscal policy is longer than for monetary policy because
balance of payments
(EX-IM) the difference between a country's total exports and total imports
it takes longer fro congress to act than the fed
a country's exports of goods and services minus its important of goods and services
other things equal _____ interest rates increase the government deficits because of _______ Government interest payments
(a)
the (a) sought to reduce the federal deficit by 36 billion each year between 1987 and 1991
per-capita output growth is the growth rate of output
(a)
convergence theory suggest that gaps in national incomes
(a)
the strict definition of economic growth that serves to increase living standards is
(a)
the growth rate of output per person in the economy is called
(a)
higher productivity can be achieved through
-new techniques of production
-innovation
-better educated workforce
- embodied technical change
- disembodied technical change
- net income
exchange rates are determined by making prices of similar goods equal in different countries. If one country has much higher inflation than another, its currency usually loses value compared to the other country's currency
is registered as a debit in the capital account and it increases private U.S assets abroad
an important source of increasing productivity is
households feel richer and spend more
may increase investment
an increase in the ratio of capital to labor
delays in the economy response to stabilization policies
diminishing returns to a factor implies that with capital fixed
as labor increases; labor productivity eventually decreases
occurs when a country's exports of goods and services are less than its imports of goods and services
a country's exports of goods and services minus its important of goods and services
the change in imports caused by a 1$ change in income
an increase in the quality of capital is a result of
disembodied technical change
foreign direct investment
embodied technical change
Japan and china
technical change which results In a change in the production process is known as
exchange rates that are determined by the unregulated forces of supply and demand
If the costs of transportation are small,the price of the same good in different countries should beroughly the same
The fall in value of onecurrency relative to another
disembodied technical change
a researcher discovered that adhesive that allows a piece of paper to be attached to a surface temporarily and then removed and reattached many times. it was many years before a use was found for this adhesive. what is this a example of ?
(a)
any investment made in a country by residents outside that country is
(a)
foreign exchange
(a)
balance of payments
(a)
balance of trade
a country's exports of goods and services minus its important of goods and services
the difference between a country's total exports and total imports
he demand for the us exports depends on economic activity in the rest of the world as-well as on the prices
fixed exchange rates under which each country agreed to intervene in the foreign exchange
trade deficit
revenue and expenditure items in the federal budget that automatically change with the economy like to destabilize GDP
the growth rate of output per worker
occurs when a country's exports of goods and services are less than its imports of goods and services
delays in the economy response to stabilization policies
the sum of income from exports of goods and services and income rom investments and transfers minus payments for imports of goods and services and payments for investment and transfers
balance of trade
balance of payments
exchange rate
balance on current account
what are the largest creditor
spain and russia
georgia and florida
japan and china
canada and antartica
what are debtor nations
spain and italy
africa and ibiza
france and paris
planned aggregate expenditure in an open economy equation
(a)
net exports of goods and services ( say equation too)
(a)
determining the level of imports "When income ______ imports tend too ____________" and what's the equation
(a)
Marginal propensity to import (MPM)
the change in imports caused by a 1$ change in income
the change in imports caused by a 4$ change in income
the change in imports caused by a 2$ change in income
the change in imports caused by a 3$ change in income
the open economy multiplier and equation
the demand for the us exports depends on economic activity in the rest of the world as-well as on the prices of US goods relative to the price of rest of the world goods
The things that influence how much households and businesses spend also affect how much people buy from other countries. This includes both things people use and things they invest in. Additionally, whether domestic or foreign goods are cheaper affects how much people buy from other countries
1
= -------------
1-(MPC-MPM)
the multiplier is smaller in an open economy than in a closed economy
"the reason; When the government spends more and people earn more, they tend to buy more. Some of this increased spending goes towards foreign products instead of domestic ones."
the determinants of imports
an increase in the ratio of capital to labor
The things that influence how much households and businesses spend also affect how much people buy from other countries. This includes both things people use and things they invest in. Additionally, whether domestic or foreign goods are cheaper affects how much people buy from other countries.
the absence of increases in the capital stock as labor increases, less and less output will be added by each new worker
the growth rate of output per person in the economy
the determinants of exports
exchange rate
is registered as a debit in the capital account and it increases private U.S assets abroad
The fall in value of one currency relative to another
the demand for the us exports depends on economic activity in the rest of the world as-well as on the prices of US goods relative to the price of rest of the world goods
the record of a country's transactions in goods, services, and assets with the rest of the word is its
(a)
the difference between a country's merchandise exports and its merchandise imports is the
(a)
the balance of payments is divided into two major accounts, the
(a)
the price of one country's currency in terms of another country currency is the
(a)
the agreements that were reached at the Bretton woods conference in 1944 established a system
consumption, saving, and imports equals $450
of essentially fixed exchange rates under which each country agreed to intervene in the foreign exchange market when necessary to maintain the agreed upon value of its currency
exchange rates that are determined by the unregulated forces of supply and demand
The rise in value of one currency relative to another
an increase in US exports to Japan ______ the demand for U.S and _____ the supply of yen
(a)
in the United States which of the following is not directly determined by U.S income ?
A. imports
B. income tax revenue
c. consumption
D. exports
(a)
if income increases by $450 we know that the change in
(a)
when an American buys an asset abroad, the transaction
The fall in value of onecurrency relative to another.
is registered as a debit in the capital account and it increases private U.S assets abroad
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
exchange rates that are determined by the unregulated forces of supply and demand
when foreign assets in the United States increase
idea that gaps in national incomes tend to close over time
the growth rate of output per person in the economy
the discounted value of its expected future dividends
the United States residents are increasing their debt to the rest of the world
when one country's economy grows, it boosts global economic activity, which in turn benefits that country's economy. For example, if the U.S. imports more goods, it boosts exports for other countries, stimulating their economies. This, in turn, increases their imports from the U.S., leading to a cycle of growth for the U.S. economy and beyond.
(a)
When prices go up in one country, it can cause prices to rise in other countries too. Then, those higher prices overseas can loop back and push prices even higher in the first country
(a)
floating or market determined , exchange rates
The fall in value of one currency relative to another.
exchange rates are determined by making prices of similar goods equal in different countries.
exchange rates that are determined by the unregulated forces of supply and demand
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
the supply of and demands of pounds
Every day, pounds and dollars are swapped between governments, individuals, banks, and companies. People wanting pounds have dollars and want to trade them, while those with pounds want dollars instead.
the equilibrium exchange rates occurs at the point which the quantity demanded of a foreign currency equals the quantity of that currency supplied
an increase in the ratio of capital to labor
per-capita output growth
the equilibrium exchange rate
describes both monetary and fiscal policy, the goals of which are to smooth out fluctuations in output and employment and to keep prices as stable as possible
due to fluctuations in stock prices and housing prices
they are temporary and dont impose any long-run problems
the equilibrium exchange rates occurs at the point which the quantity demanded of a foreign currency equals the quantity of that currency supplied
appreciation of a currency
(a)
depreciation of a currency
(a)
If the costs of transportation are small,the price of the same good in different countries should be roughly the same
(a)
purchasing-power-parity theory
was the major system of exchange rate determination.• All currencies were priced in terms of gold, with an ounce of gold worth a lot in each currency.
exchange rates are determined by making prices of similar goods equal in different countries. If one country has much higher inflation than another, its currency usually loses value compared to the other country's currency.
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
the gold standard and the problems of it
The U.S dollar is a fiat currency, a fully convertible currency And a floating currency
2.00
work MPS= 1-.6 = .4.
M= 1
------- = 2.0
.4+.1
- was the major system of exchange rate determination.• All currencies were priced in terms of gold, with an ounce of gold worth a lot in each currency.
-The gold standard implied that a country had little control over its money supply. When major new gold fields were discovered, the world's supply of gold (and therefore of money) increased.
WOTF Is correct about the US dollar
(a)
