economics 976-1020 Flashcards Preview

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Flashcards in economics 976-1020 Deck (44):
1

in a balance of international payments, exports are listed as (credit/debit) items

credit

2

if an item provides us with more foreign currency, it counts as a (credit/debit) in our balance of international payments

balance

3

the relationship between the value of a nation's exports and the value of its imports is called the trade _____.

surplus

4

a tred (surplus/deficit) occurs when the value of exports exceeds the value of imports

creditor

5

The United States emerged from WW1 as a new (creditor/debtor) nation.

debit

6

in a balance of international payments, imports are listed as (credit/debit) items.

a good or service produce domestically and sold to consumers in another country

7

define export

debtor

8

young nations are usualy (creditor/debtor) nations

an measure of the flow of products and capital resources between a country and the rest of the world

9

what is a alance of international payments

it mus either run down its assets or owe money

10

how does a country pay for a trade deficit

the sherman antitrust act of 1890

11

what law made it illegal to monopolize any pat of trae r commerce among the several states and outlawed any combination or conspiracy in restraint of trade

not necessarily

12

is a trade deficit always bad

TRUE

13

T/F : Mercantilists thought that rtrade surpluses were good becase they meant gold would flow into the home country

a trade restriction imposed by several allies against one or more nations

14

what is a multilateral trade sanction

it ended border controls a tariffs and began monetary coordination among members of the European Community

15

what did the maastricht treaty accomplish

a ban on the trade of a good, or ban on trade with a nation altogether

16

what is an embargo

they believe that infant industries stand a better chance of surviving if established foreign competitors are not allowed to drive out of business

17

why do protectionists wish to assist infant industries by restricting trade

high-tariff

18

the United states has traditionally been a (high-tariff/low-tariff) nation

TRUE

19

true or false: in the year 2000, the united states lifted some trade sanctions against Cuba on medical and agricultural god.

A person is unemployed if he or she is not currently working and is either waiting for recall after being laid of or has actively looked for work in the last four weeks.

20

what is the official definition of unemployment?

1%

21

according to Okun's law, if GDP falls 2% relative to potential GDP, by how much does the unemployment rate increase?

Product differentiation; convincing the consumer that a particular firm has a "better" product even though the products in the market may all be quite similar.

22

What is branding?

the unemployment of people who are between jobs.

23

What is frictional unemployment?

a rise in the general price level in an economy.

24

What is inflation?

an extremely high rate of inflation.

25

What is hyperinflation?

cost-push inflation.

26

when the prices of factors of production increase rapidly, what kind of inflation is likely to result?

Like it? you love it.

27

If you're over your head in debt, do you like or dislike inflation?

more

28

At higher interest rates, individual save money?

None; a credit card transaction is like a short-term lone.

29

credit cards are part of which money supply definition?

GDP deflator

30

the measures the largest variety of price levels?

a checking account

31

which of the following is the most liquid: a checking account, a savings, or a government bond?

low

32

Individuals are more likely to invest in stock if interest rates are?

demand

33

A checking account is also know as a _____ deposit.

high unemployment and high inflation; low unemployment and low inflation

34

Name two unemployment/ inflation combinations NOT shown in the phillips curve.

currency, checking accounts and traveler's checks

35

what constitutes m1?

interest compensates individuals for putting money in savings.

36

how do interest rates give individuals an incentive to save?

dislike

37

if you keep all your money in cash, hidden under your bed, do you like or dislike inflation?

all are measures of the current price level

38

what do the CPI, the PPI, and the GDP deflator have in common?

price- interest is the cost of borrowing money

39

interest can be seen as the (price/quantity) of money.

TRUE

40

true or false: the U.S. dollar is an example of fiat money.

it raises the pice level

41

what does inflation do to the price level of an economy?

consumers hoard currency that is valuable rather than spending it. they spend currency that is less valuable. thus, a real gold coin that is stamped "25 cents" will be hoarded while a regular quarter is spent.

42

Explain why Gresham's law holds.

the see with which money can be converted to cash.

43

to what does liquidity refer?

Demand-pull inflation is the result of a shortage; demand in excess of supply causes consumers to bid the price level upward.

44

Define "demand-pull inflation."

Bad money drives out good money.