Do You Know Macro?

The interest rate will fall

There will be a movement downward along the money demand curve

There will be a a movement upward (to the left) along the money demand curve

There will be a rightward shift of the money demand curve

There will be a leftward shift of the money demand curve

Interest rates

Prices

The transactions demand for money

GDP

The Fed

The prime interest rate

The federal funds rate

The M1 money supply

The M2 money supply

The M3 money supply

Is developed in secret

Applies to some states but not others

Applies to some industries but not others

Works automaticaly without public announcement or plan

Is an intentional change in taxation or government spending

Remain unchanged

Rise by $300

Rise by $200

Rise by $900

Fall by $300

Increase government spending by the size of the gap

Decrease government spending by the size of the gap

Increase government spending by more than the size of the gap

Increase government spending by less than the size of the gap

Decrease government spending by more than the size of the gap

Active government intervention

A reliance on prices to adjust to changing market conditions

Classical economics

Neoclassical economics

Quantity supplied creates its own quantity demanded

Tax reductions passed by Congress in times of unemployment

Tax reductions passed by Congress in times of inflation

Government defense spending

Unemployment compensation

Welfare programs

How quickly fiscal policy can respond to changes in economic conditions

How fiscal policies unintentionally affect individual incentive to work, spend, save, and invest

How fiscal policy affects the price level

How fiscal policy affects the economy's output

How voters might respond to a policy that increases taxes

Not about the legal minimum

Always about the legal minimum

Measured in terms of goods and services it can buy

Measured in current dollars rather than in constant dollars

Measured in constant dollars rather than in current dollars

It is the equilibrium price level in the short run

It determines the actual price level in the short run

It determines the actual price level in the long run

Firms and resource owners make long-term agreements based on the expected price level

The difference between the expected price level and actual price levels is equal to the actual inflation rate

Falls by 2%

Falls by 10%

Rises by 2%

Rises by 10%

Remains constant

Hysteresis

Hysterical analysis

Historical analysis

Histoplasmosis

Hypoglycemia

Unintended inventory increases

A reduction in GP

A decrease in imports

An increase in government purchases

Unintended inventory reductions

$10 billion increase in equilibrium investment

$40 billion increase in equilibrium investment

$40 billion increase in equilibrium real GDP demanded

$400 billion increase in equilibrium real GDP demanded

$40 billion increase in consumption spending

Government started spending more on national security

People who lost jobs or feared they would lose their jobs started spending less

Business invested in back-up data centers in case their main computers were attacked

Consumers went back to shopping at the urging of gov't officials

All of the above

4

1/5

4/5

5/4

5

Increase it's current C spending

Decrease it's current C spending

Maintain "

Increase it's current C spending, then increase spening when income falls

Decrease it's current C spending, then increase spening when income falls

Is about as volatile as consumption, except during recession years

Has averaged about 1/6 of GDP over the psat decade

Is about a volatile as GP, except during recession years

Is the largest component of A.Spending

Have averaged about 2/3 of GDP over the past decade

Investment declines while C increase

I increases while C declines

I is constant while C declines

I declines much faster than GDP declines

C declines much faster than GDP declines

Account for almost all of the variability in GDP during expansions

Account for almost all of the variability in GDP

Account for almost all of the variability in GDP during recessions

Are larger during expansions than during recessions

Account for more of the variability in GDP than consumption does

Goods and services to firms and government

Resources to firms and governments

Tax payments to governments

The demand for only what firms supply or make available

Money to firms in exchange for goods and services

It is the most comon form of business organization

It is responsible for a large portion of total production of goods and services

It offers the owner the least personal liability of any form of business organization

There is no opportunity cost to operating the business

Only one individual can work in such a firm

Sole proprietorshops

Partnerships

Corporations

Nonprofit institutions

S-corporations

Macroeconomic policy is handly mainly at the state level.

Higher education is handled mainly at the national level.

Primary and secondary education is handled mainly at the local level.

Primary and secondary education is handled mainly at the national level.

Police and fire protection are handled mainly at the state level.