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79 Cards in this Set
- Front
- Back
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Economic growth is defined as equal to the increase in what
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Sustained expansion of production possibilities measured as the increase in real GDP over a given period
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In 1996 real GDP was 6.5 billion in 1997 real GDP was 7.1 billion what was US economic growth rate from 96 to 97? Express the answer in terms of percent
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9.23 percent
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The rule of 70 can be used to calculate the number of years it takes for a level of the variable to what?
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Double
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In the growth area that change in the country's standard of living as measured by the change in?
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Real GDP per person
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It took 20 years for real GDP double what was the growth rate?
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3.5%
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Labor productivity is equal to the quantity of?
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Real GDP/aggregate hours= labor productivity
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Classical growth theory that increases in real GDP per person will?
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Returns the subsistance level
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Neoclassical growth theory
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GDP is determined by population growth rate plus the labor productivity growth rate in deuce by technological change
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Economic freedom
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A condition in which people are able make personal choices or private property is protected and they are free to buy and sell the markets
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One way to achieve faster growth in GDP person is to increase what
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Create incentive mechanisms encourage saving encourage research and development encourage international trade and improve the quality of education
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Economists use the word capital mean, what
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Capital or physical capital is the tools, instruments, machines, buildings other items that have been produced in the past that are used to produce goods and services. Inventories of raw materials, semi finished goods, and components are part of physical capital.
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Total amount spent by new physical capital and replace old capital is referred to as
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Gross investment
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2009 Barber earn 60,000 paid taxes of 5000 spent 53,000 arbors wealth was 4000 at the beginning of the year what was it at the end of the
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6000
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A share of stock is?
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Stock certificate of ownership in the claim in the profits firm makes
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Demand for loanable funds. How does it change with economic times?
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Interest rate rises, the quantity of loanable fundsdemanded decreases. If interest rates fall, but quantity of loanable fundsincreases
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Economic growth is defined as equal to the increase in what
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Sustained expansion of production possibilities measured as the increase in real GDP over a given period
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In 1996 real GDP was 6.5 billion in 1997 real GDP was 7.1 billion what was US economic growth rate from 96 to 97? Express the answer in terms of percent
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9.23 percent
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The rule of 70 can be used to calculate the number of years it takes for a level of the variable to what?
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Double
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In the growth area that change in the country's standard of living as measured by the change in?
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Real GDP per person
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It took 20 years for real GDP double what was the growth rate?
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3.5%
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A tendency for higher government budget deficit to decrease investments is called what
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Crowding out effect
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Money is any commodity or token that is
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Generally accepted as patent
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Barter requires what
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A double coincidence of wants
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This tour of value function is defined as what
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Any commodity or token that can be held and exchange later for goods and services is called a store value
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The debit card is, as it relates to money, is it or is it not money?
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It is not money debit cards are like checks they are not money
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You deposit $1000 in cash on deposit at your bank. The quantity of M1 does what?
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Increases the money supply
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A commercial bank is defined as?
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A firm that is ordered by the Comptroller of the currency and the US treasury or by a state agency to accept deposits and make loans
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Because the Fed is a central bank who does it provide banking services to?
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Says a public authority that provides banking services to banks and governments and regulates financial institutions and markets. The central bank does not provide banking services to business and individual citizens
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Who regulates the quality money circulating in the economy
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Board of Governors Federal Reserve Bank Federal open market committee
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The main policy maker of the Federal Reserve system is called what
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FMO see federal open Arctic committee
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Required reserve ratio is 2% you deposit $1000 and a checking account that bank must do what
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Place $100 on reserve
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The discount rate is what
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Discount rate is the initial interest rate at which the Fed stands ready to land money to commercial banks
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The bank has deposits of $100,000 in total reserves of $100,000 reserve ratio was 20%. What are the banks excess reserves
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80,000
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Banks create money by doing what
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Making loans
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The opportunity cost of holding money is
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Nominal interest rate
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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Barb is willing alone $10,000, and she can earn a real interest rate of 6% if inflation rate is 2% are should make the loan if the nominal interest rate is
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8%
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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When the price level increases, people demand more money in the demand curve for the money does what
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Stays the same
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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In the long run an increase in the quantity of money leads to
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the economy returns to its long-run equilibrium interest rate but at a higher price level
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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The velocity of circulation is equal to what
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Price level* real GDP/quantity of money . V=(P*Y)/M
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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The inflation rate increases then
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Collation reduces potential GDP slows real GDP growth
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If inflation exceeds 50% per month it is called what
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Hyperinflation
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Hi inflation, what does it lead to
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Tax on holding money
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Inflation increases the cost of holding money
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Costs that arise from and increase the velocity of circulation of money and an increase in the amount of the after-tax real rate
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Shoe leather cost of inflation
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Costs that arise from an increase in the velocity of circulation of money and an increase in the amount of running around people do to try and avoid incurring losses from falling value of money
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