Chapter 13

Question 1

What is our economy in a constant state of?

Answer 1

flux

Question 2

Business cycles

Answer 2

is regular ups and down in the economic growth marked by periods of expansion (economy is in a period of growth) and contraction (the economy is in a period of decline)

Question 3

Business fluctuation

Answer 3

alternating periods of expansion and contraction.

Question 4

Phases of Business cycle

Answer 4

recession

expansion

Question 5

Recession

Answer 5

a decline in the GDP lasting at least two quarters in a row or more. The recession begins when the economy reaches a peak (the point where the real GDP stops going up) and ends when the economy reaches a trough (the point where the real GDP stops going down)

Question 6

Expansion

Answer 6

a period of uninterrupted growth of real GDP

Question 7

what happens if recession becomes severe/

Answer 7

it turns into a depression

Question 8

Causes of the business cycle

Answer 8

1. External shock- such as wars, internal conflicts
2. Changes in investment spending- are companies growing and investing or not
3. Changes in monetary policy- the policies of the federal reserve (increase or decrease in interest rates)
4. Fiscal policy shocks- federal government spending
5. Speculation and bubbles- expectations about the future

Question 9

how did the great depression begin?

Answer 9

stock market crash “black tuesday”

Question 10

How much did the GDP drop in the great depression?

Answer 10

50%

Question 11

What was the darkest period economically in history?

Answer 11

great depression

Question 12

What are the causes of the great depression?

Answer 12

1. unequal distribution of wealth
2. credit
3. international trade wars

Question 13

What came out of the depression?

Answer 13

economic reforms

Question 14

What are some economic reforms ?

Answer 14

social security

minimum wage

Question 15

what did unemployment programs give?

Answer 15

relief to people out of work

Question 16

Name a unemployment program

Answer 16

federal deposit insurance corporation

Question 17

What did the FDIC do?

Answer 17

created banking insurance for peoples deposits

Question 18

how much did the GDP decline in great recession?

Answer 18

5%

Question 19

what was the major cause of the great recession?

Answer 19

home loans grants to borrowers with poor credit histories and no down payments considered high risk loans.

Question 20

what are the causes of instability in economy?

Answer 20

inflation

deflation

Question 21

inflation

Answer 21

a sustained rise in general level of prices and services

Question 22

deflation

Answer 22

a sustained decline in general level of prices and services

Question 23

what does the flow of money in the family represent?

Answer 23

the value system under which that family operates

Question 24

what do men say about emergency fund savings?

Answer 24

its boring and not sophisticated enough

Question 25

what do women say about emergency fund savings?

Answer 25

its the most important key to our financial plan

Question 26

how do men get good deals?

Answer 26

negociating

Question 27

How do women get good deals?

Answer 27

hunting

Question 28

how do men feel about financial problems?

Answer 28

lose self esteem because money usually represents a scorecard to them

Question 29

how do women feel about financial problems?

Answer 29

they face fear or terror, because money means security.

Question 30

what is the number one cause of divorce in america?

Answer 30

money fights

Question 31

what happens when you agree on the money system?

Answer 31

you will reach a unity in marriage that you can experience no other way

Question 32

who does the financial planning?

Answer 32

both

Question 33

who can prepare the budget?

Answer 33

the partner with the natural gift but both do decisions

Question 34

why does the nerd like doing the budget?

Answer 34

because it gives them control, and they fell like they are taking care of loved ones.

Question 35

how can the free spirit appear to the nerd when doing finances?

Answer 35

can appear irresponsible

Question 36

how does the free spirit feel when doing finances?

Answer 36

controlled and not cared for

Question 37

what can lead to poor money management?

Answer 37

time, poverty, and fatigue

Question 38

what can impulse buying be brought on by?

Answer 38

stress or even I owe it to myself

Question 39

What does a written plan give a single person?

Answer 39

empowerment, self accountability and control

Question 40

what must accountability frinds be?

Answer 40

loving enough to be brutally honest with you

Question 41

whos responsibility is it to teach kids to handle money?

Answer 41

parents

Question 42

What should parents do instead of allowances?

Answer 42

commissions

Question 43

how should parents teach their kids?

Answer 43

by example

Question 44

What should parents teach their children about money?

Answer 44

how to live debt-free, how insurance works, IRA

Question 45

what money-saving technique should you use with 5-12-year-olds?

Answer 45

giving, spending, and saving

Question 46

What money-saving technique should you use with 13-15-year-olds?

Answer 46

open a checking account for the child and teach him how to run it by monthly reviews

Question 47

nerd

Answer 47

the one who likes to deal with numbers and the budget

Question 48

commission

Answer 48

getting paid based on the work you complete

Question 49

free spirit

Answer 49

the one that goes with the flow

Question 50

accountability

Answer 50

taking responsibility and assisting with wise decisions

Question 51

Value system

Answer 51

what is important to you