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Flashcards in Economics BA(last one) Deck (29):
0

How does an increase in military spending affect the domestic economy as measured by the GDP?

GDP increases

1

in the United States, which component of GDP is largest?

consumer spending

2

what are some examples of regressive taxes?

State sales tax and state property tax

3

what type of tax is the state sale tax?

reggressive

4

what is the main purpose of the Federal Reserve?

to control the money supply

5

how does inflation affect the domestic economy?

it reduces purchasing power

6

what will the Federal Reserve do with interest rates if there is inflation

interest rates will increase

7

watch type of unemployment is represented by a college graduate who does not have a job during the first month after graduating?

frictional unemployment

8

identify then explain why an ATM machine that replaces a bank teller will create a more permanent type of unemployment and maybe more difficult to correct?

structural unemployment

9

explain why the government keeps track of the consumer price index

it measures inflation

10

during the peak of the business cycle, what happens to unemployment?

unemployment is at a low rate

11

using fiscal policy, explain why the government would step in to try to increase government spending

The government may increase government spending to stop a recession

12

why would government spending on medical research result in lower unemployment and more economic growth

Government spending in the sector could lead to an investment in employees

13

using monetary policy, explain how arise in government securities would affect consumer behavior

people will buy more savings bond

14

what could be an unintended consequence of using corn ethanol as a alternate fuel

The price of corn increases

15

how has increased outsourcing affected consumers

prices aren't as high

16

as the economy globalizes, what happens to quality-control

consumers have less guarantee of quality control

17

what impact has globalizing economy had on auto makers

it has forced the automobile industry and sellers to be more competitive

18

is there more interdependence or less interdependence as a result of globalization

more

19

what impact does globalization have on domestic jobs

one effect of globalization is a shift in the types of domestic jobs available

20

what is a benefit of the US dollar weakening against the euro

The US exports more goods

21

what is comparative advantage of trade

can produce item or efficiently than other country

22

what is absolute advantage of trade

is better at producing everything than another country

23

what is the main advantage of producing according to the concept of comparative advantage

it's makes the most efficient use of world resources

24

if all other factors stay the same, what happens to GDP when the US consumers buy more foreign cars?

that will reduce the GDP

25

how would outsourcing impact manufacturing jobs in the US

increased outsourcing leads to a decreasing number of manufacturing in the US

26

how might the international monetary fund held a developing country

by providing loans to support their economy

27

what's international organization would be most concerned with protective tariffs?

World Trade Organization

28

which international organization monitors loans made to countries around the globe

World Bank or monetary fund. They are the same thing.