Trang chủ 6. Test - Economics - No 2






A client tells you that he currently earns $100,000 per year and is comfortable with his lifestyle at that income level. He says he is planning on retiring in 5 years. If inflation averages 8% over the next 5 years, approximately what income level will this client require to maintain his current lifestyle?


Use the table below to choose the correct answer.

Time Period Actual Inflation
1 4 percent
2 4 percent
3 6 percent
4 8 percent

According to the adaptive expectations hypothesis, at the beginning of period 3, decision makers would expect inflation during period 3 to be ________.

Which of the following is/are components of the M3 money supply? I. Overnight repos II. Overnight Eurodollar deposits III. M1 supply IV. M2 supply


Congress passes a law requiring the government to pay certain debts of companies that have declared bankruptcy. Which of the following terms most accurately describes this program?


The "extra" money you take on a trip in case your car breaks down is an example of the


Mr. Taylor states in his will that his $50,000 portfolio of bank CD's will go to his only son. Upon Mr. Taylor's death, the son sells the CD's and invests the proceeds in a stock mutual fund. How does this immediately impact M2 and the effective amount money available for transactions?


Given the information below, during which quarters does real income decline?      

Nominal GDP GDP Deflator 
Q 0 (base) 981 100
Q1993 101
Q21,001 106
Q31,042 111
Q41,040 107




Within the Keynesian model, when planned aggregate demand equals total output,

Suppose that the Central Bank announces that it will increase the money supply by 5%. Producers collectively determine that this will cause a 5% increase in both the price of their products and the cost of their inputs. How will this impact real GDP?


If the amount of money in circulation is $200 million and the nominal GDP is $950 million, then the money velocity is ________.

If unemployment were 3 percent and prices were rising 12 percent annually, which of the following would be the most appropriate policy?

Each month, the Bureau of Labor Statistics calculates unemployment by

If the Fed conducts a demand stimulus policy, the rational expectations theory implies that

If the resources of an economy were fully employed and the marginal propensity to consume were 0.75, a $10 billion increase in investment would cause

The consumer price index (CPI) is calculated

Which of the following will most likely result in an increase in the per capita GDP of a country?

In a situation where information is costly to acquire and individuals must spend time searching for jobs, which type of unemployment will result?

Which of the following would be considered non-activist monetary policy?

In the Keynesian aggregate expenditure model, the larger the marginal propensity to consume,

When financing a budget deficit, the government might borrow money from ________.