WorksheetsRen Ec
Total questions: 89
Worksheet time: 43mins
A regressive tax is a tax is where
rich is taxed less and poor is taxed more
poor is taxed less and rich is taxed more
all are equally taxed
none of the above
Fee charged by the Federal Reserve Bank for other member banks to borrow money from the FED through the discount window?
inflation
interest
discount rate
reserve requirement
The goal of monetary policy is to
sell bonds
reduce unemployment
prevent inflationary and recessionary economic periods
increase tariffs on foreign countries
"The Fed" refers to the....
Federal Bureau of Investigation
Federal Government
Federal Reserve System/Bank
Federal Income Tax
number of federal reserve district banks?
5
10
12
21
What are two main monetary tools the government has?
government spending and reserve requirement
taxes and government spending
buy/selling bonds and discount rate
discount rate and taxes
Which answer below is something that the FED does NOT do?
buy/sell bonds
increase/decrease discount rate/fed funds rate
increase/decrease income tax rates
increase/decrease reserve requirement
Choose the 2 answers below that are fiscal policy tools of the Federal Government
Local referendums
Taxes
Discount Rate
Government Spending
If the economy was going into a recession, what would the Federal government do with taxes?
increase them
do nothing
decrease them
If the economy was going into an inflationary period, what would the Federal government do with government spending?
increase it
do nothing
decrease it
taxing and spending
fiscal
monetary
joint effort between the executive and legislative branches
fiscal
monetary
Congress reviews the budget and offers suggestions
fiscal
monetary
to help the economy grow, the government will decrease or lower taxes. This allows people to have more money and buy more goods and services
fiscal
monetary
What can the government do to slow the economy down?
lower taxes
raise taxes
spend more
spend less
to help the economy grow, the government can
increase spending
decrease spending
lower taxes
raise taxes
to slow the economy down the government can.....
spend more
spend less
tax more
tax less
the action by the FED to adjust the size of the money supply, and to adjust interest rates in order to keep prices down and employment high.
fiscal policy
monetary policy
to help the economy grow, the FED may____________the reserved requirement, allowing banks to loan more people money so that they spend more
lower
raise
spend more
save more
to slow the economy, the FED may____________ the reserve requirements and there will be less money to loan out to people.
increase
decrease
spend more
tax more
the amount that all banks have to keep in the reserve and they can't loan out to people
monetary lending
fiscal spending
reserve requirement
lending policy
the interest rate the FED charges banks, to borrow money. It will be lowered to help the economy grow and raised to slow the economy
reserve requirement
discount rate
bank rate
monetary bank
How does the federal government borrow money?
asks members of congress to fork over some of their salaries
raises taxes
sells treasury bonds
asks people on welfare for food stamps
1. Which of these options is not a role of government?
Producer
Consumer
Lawmaker
Tax payer
2. What is Macroeconomics?
the economy as a whole
The part of economics concerned with single factors and the effects of individual decisions
The study of how a national economy works
The analysis of the behavior of individual consumers and producers
3. Which of these options is a macroeconomic objective?
Economic growth
A high and stable level of employment
Equitable distribution of income and wealth
All three
4. If a government can achieve their aims
It will create a favorable economic climate for business and improve people’s standard of living
The level of employment will decrease
People’s standard of living will deteriorate
People's standard of living will stagnate
5. How do governments want to achieve their aims?
By exploiting people
By maximizing the exploitation of natural resources
In satisfying big companies requests
In an environmentally sustainable manner
6. Expansionary policy is used to boost economic activity. Which of these propositions is not an expansionary policy tool?
Decreasing interest rates
Increasing interest rates
Increasing government spendings
7. Expansionary policy will often be used, except
During recession
During rising inflation
During an economic downturn
8. Supply-side policies:
Aim to maximizing the exploitation of natural resources
Aim to boost the productive potential of the economy and increase aggregate supply
Aim to slow down the economy during rising inflation
Aim to unbalance the trade balance
9. When implementing supply-side policies, the government uses a range of tools to increase the quantity and quality of resources in the economy such as:
Subsidies
Competition policy
Tax incentives
All three
10. Contractionary policy is used to slow economic activity. Which of these propositions is not a contractionary policy?
Decreasing interest rates
Increasing interest rates
Decreasing government spendings
11. Contractionary policy will often be used:
During recession
During rising inflation
During an economic downturn
During an overheating economy
12. Expansionary policy is used to boost economic activity by:
Decreasing interest rates
Increasing interest rates
Decreasing government spendings
Increasing government spendings
13. The definition of inflation
Sustained fall in the general price level.
The rise in the general level of prices
14. Fiscal policy is
The total demand for goods and services in the economy
Policies that control the supply of money, the price of money, and the availability of credit.
Use of government spending and revenue collection measures to influence the economy.
When a nation's total output of goods and services increases over time
15. Factors of production
Goods and services
Technology
Entrepreneurship
All three
A country's economy has natural ups and downs in its business cycle.
True
False
Which of the following is a problem in the business cycle?
Value of country's currency
high exports
high employment
Trade externalities
What is a key indicator of economic growth?
(a)
The total sum of all goods and services produced in a certain time period.
GDP per capita
GDP
GNP
GNH
Which of these are things used to calculate GDP?
Consumer spending
investor spending
Government spending
Tax deductions
The (value of exports-value of imports) is also used to calculate GDP.
True
False
Purchasing power parity (PPP) compares economic growth and standards of living in different countries with a common currency/basket of goods approach.
True
False
Governments need to always keep ________ moving in order to ensure economic growth
country
economy
business
population
What can a government do in order to ensure economic growth?
Keep high employment rates
increase interest rates
increase taxes
print more money
What is important to keep a country growing?
economic growth
technological growth
economic and technological growth
economic and technological decline
Why can be done to keep the economy stable and safe?
Keep prices very high
Keep prices from going too high
Keep taxes very high
Keep unemployment very low
Who benefits from a stable economy?
Consumers
Producers
Reserve Bank
Investors
The Economy depends on the people because they are the ones who spend most of the ________.
profits
taxes
money
time
Which of the following is not something that helps an economy grow?
Going on protests and strikes
using technology
eliminate waste
having an educated population
How does Government increase/secure technology?
Builds own research group
Stop and control research
Gives money to schools for research
Giving Patents and Copyrights
How does the government keep Stability?
(a)
GDP = Consumption by households + Investment by producers + government spending + (imports - exports)
True
False
Nominal GDP can rise in value because of two of the below reasons. Which reason is not correct?
The output of the country increases
The general level of prices in the country decreases
The general level of prices in the country increases
Which one of the following is NOT a method of calculating real GDP?
income method
savings method
expenditure method
GDP per capita means
real GDP per household
real GDP per head
real GDP per worker
If the real GDP for a given period is divided by the size of the population for that same period, it is known as
GDP at factor cost
GDP at market prices
real GDP
GDP per capita
Suppose that in the country of Xanadu, the real GDP in 2004 was R1883 billion. In 2005, real GDP was R1610 billion. In Xanadu, real GDP grew by
14.5%
17%
-14.5%
-17%
The following information is taken from the national accounts of Zambibia:
C = R200 million
I = R50 million
G = R150 million
X = R200 million
M = R180 million
Gross Domestic Expenditure is
R400 million
R420 million
R600 million
R380 million
If a country experienced a substantial loss of property due to a natural disaster, what would the impact be on the PPC?
An upwards shift along the PPC
A downwards shift along the PPC
An inwards shift of the PPC
An outwards shift of the PPC
Which of the following is not a cost of economic growth?
Distribution of income becomes more unequal.
Depletion of natural resources
Decreased inflation
Pollution and environmental damage
Which of the following is not a supply side policy to encourage economic growth?
Subsidies on research & development
Privatization & deregulation
Lowering corporation tax
A rise in investment
A quota is a physical limit on the quantity of a good that is allowed into a country.
True
False
By devaluing the value of a country's currency, the price of their exports in overseas markets will become more expensive and the price of imports into the country will become cheaper.
True
False
Economic growth measures the
Growth of productivity
Increase in nominal income
Increase in output
None of the above
Economic growth can be measured by
The CPI
The CBI
GDP
MPC
Economic growth can be seen by an outward shift of
The Production Possibility Frontier
The Gross Domestic Barrier
The Marginal Consumption Frontier
The Minimum Efficient Scale
In a recession, GDP
Grows negatively
Grows slowly
Grows by 0%
Grows rapidly
In a boom
Unemployment is likely to fall
Prices are likely to fall
Demand is likely to fall
Imports are likely to fall
What is GDP per capita?
GDP x population
GDP / population
GDP + population
GDP - population
Which of the following DOESN’T cause economic growth?
Increased investment
Improved technology
Increased labour productivity
Less investment in education
If GDP is £300 billion and the population is 30 million. What is GDP per capita?
£270 billion
£100,000
£10,000
£1,000
Which of the following is a benefit of economic growth?
A rise in the standard of living
Increased pollution
Increased congestion
Inequalities in income and wealth
Which of the following is a cost of economic growth?
A fall in unemployment
A rise in employment
A reduction in poverty
Loss of non-renewable resources
Calculate the economic growth rate if GDP was £60 billion in Year 1 and £63 billion in Year 2.
1%
5%
10%
15%
The literacy rate for the region of Latin America is 90%. Country A has a literacy rate is 51%. Which statement best reflects these factors of economic growth in Country A?
Country A’s low investment in human capital lowers the GDP per capita.
Country A has greater opportunity for other capital investments than education.
Country A’s GDP per capita would decrease if there was more investment in human capital.
Country A’s high investment in human capital lowers the GDP per capita
A period of macroeconomic expansion or growth, followed by a period of contraction, or decline.
Business Cycle
Circular Flow
Equilibrium
GDP
Which combination of factors is most likely to result in economic growth?
an increase in management productivity together with a reduction in the hours worked per employee
increased educational enrollment together with an increase in business regulation
the discovery of a new raw material deposit together with significant emigration of labour
the invention of a technology together with the investment to use it in the economy
What will result in the short run from rising unemployment in an economy?
The government’s budget deficit will fall.
Any existing inflationary pressure will be reduced.
Potential output will fall.
The economy’s production possibility curve will shift inwards
