macro test 1 Flashcards
(11 cards)
when the people loose hope in the economy so they store money in their homes and not the bank (deflation)
liquidity trap
business men want prices to be ________; ______
buyers want prices to be _____; _____
economic shocks ______;______
Flexible; upwards
stable; downwards
flexible; upwards
why is communism bad? (5)
freedom & independence r taken away
not genuine leaders, betray their ppl
people get dependent & comfortable
does not give incentives to make ppl try
kills production & growth
nominal GDP
Real GDP
Current price x current quantity
Base yr price x current quantity
Hugo chavez tool power in ____ and died in _____
Hugo Chavez introduced social programs (misiones) with ________ to use oil wealth to reduce poverty
1998; 2013
Cuba
who was the next president after hugo chavez?
Maduro
labor force participation rate
unemployment rate
labor force/ working-age population
unemployed/labor force x 100/1
natural rate of unemployment is a mix of _______ and _________ unemployment
frictional & structural
things that dont count in GDP (4)
Intermediate goods
used goods
transfer payments
Financial Transactions (stocks/bonds)
limitations of GDP
P opulation
I nequality
E nvironment
S hadow economy
why is free stuff bad?
because it doesn’t give any incentives to be better (no productivity/efficiency)
