ECO 372 Final Exam Guide
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1) The largest source of household income in the U.S. is obtained from
2) The market where business sell goods and services to households and the government is called the
3) Real gross domestic product is best defined as
4) Underemployment includes people
A. who work “off-the-books” to avoid tax liabilities B. who are working part time, or not using all their skills at a full-time
5) The Bureau of Economic Analysis is responsible for which of the following?
6) The Federal Reserve provides which of the following data?
7) Consider if the government instituted a 10 percent income tax surcharge. In terms of the AS/AD model, this change should have
8) If the depreciation of a country’s currency increases its aggregate expenditures by 20, the AD curve will
A. shift right by more than 20 B. shift right by less than 20 C. shift right by exactly 20 D. not shift at all
9) Aggregate demand management policies are designed most directly to
10) Suppose that consumer spending is expected to decrease in the near future. If output is at potential output, which of the following
policies is most appropriate according to the AS/AD model?
11) According to Keynes, market economies
12) The laissez-faire policy prescription to eliminate unemployment was to
13) In the AS/AD model, an expansionary monetary policy has the greatest effect on the price level when it
14) The Federal funds rate
15) What tool of monetary policy will the Federal Reserve use to increase the federal funds rate from 1% to 1.25%?
16) If the Federal Reserve increases the required reserves, financial institutions will likely lend out
17) Suppose the money multiplier in the U.S. is 3. Suppose further that if the Federal Reserve changes the discount rate by 1 percentage
point, banks change their reserves by 300. To increase the money supply by 2700 the Federal Reserve should
A. reduce the discount rate by 3...