CAS EC 102 Study Guide - Midterm Guide: The World Factbook, Foreign Exchange Market, Positive Statement

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CAS EC 102 Full Course Notes

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Introduction 2: supply and demand 5, population and social security 11, a nation"s output: gdp 18. Macroeconomic = study of large economic forces in the world. Political and economic systems are not tied together. Individual owns some business while government owns key sectors: banks, airlines, utilities: communism, government owns all. There are many political systems but the main difference is how much one has a say in government decision. Micro studies market de(cid:272)isio(cid:374)s that a(cid:396)e u(cid:374)de(cid:396) a pe(cid:396)so(cid:374)(cid:859)s, fa(cid:373)il(cid:455)(cid:859)s o(cid:396) (cid:272)o(cid:373)pa(cid:374)(cid:455)(cid:859)s (cid:272)o(cid:374)t(cid:396)ol. Macro studies market forces beyond control of anyone: important since understanding them can better people off. Incentive: a(cid:374)(cid:455)thi(cid:374)g that i(cid:374)flue(cid:374)(cid:272)es people(cid:859)s (cid:271)eha(cid:448)io(cid:396, positive incentive is when one is rewarded for doing sth, negative incentive is when one is punished for doing sth. Interconnections: entire world is connected, each decision affects the economic world. Increase in interconnection raises amount of output available: decrease in interconnection decrease output available, interconnection allows people to specialize (specialist produces more than generalist)

Related Questions

1) Suppose inflation in Mexico goes from 4% to 3% over the year. What will be the immediate impact on Mexico's balance of trade?

	A	increase
	B	decrease
	C	remain constant
	D	cannot be determined

reasoning?

2) If Great Britain imports more than it exports, then

	A	the supply of pounds is likely to exceed the demand for pounds in the foreign exchange market.
	B	the demand for pounds is likely to exceed the supply for pounds in the foreign exchange market.
	C	the pound will likely appreciate against other major currencies in the foreign exchange market.
	D	none of the above

skysea-lion269

Multiple Choice (2 points each)

Identify the choice that best completes the statement or answers the question.

____ 16. Government purchases, under the expenditure approach to GDP accounting, do not include:

a.	state government purchases of plumbing services.
b.	Social Security benefit payments to retirees.
c.	the salaries of military officers.
d.	federal government purchases of computers.

____ 17. GDP equals $8 trillion. If consumption equals $5.5 trillion, investment equals $500 billion, and government spending equals $1.5 trillion, then:

a.	exports exceed imports by $500 billion.
b.	imports exceed exports by $500 billion.
c.	net exports equal zero.
d.	exports exceed imports by $1 trillion.
e.	imports exceed exports by $1 trillion.

____ 18. If some non-price level determinant causes total spending to increase, then the effect on aggregate demand will be a:

a.	movement upward along the curve.
b.	movement downward along the curve.
c.	shift to the left.
d.	shift to the right.

____ 19. An increase in the U.S. price level will:

a.	increase U.S. exports.
b.	increase U.S. imports.
c.	increase RGDP demanded in the United States.
d.	both a. and c.
e.	both b. and c.

carminehornet803

1. According to World Bank, nations with a per capita income of $15,000 can be classified as

(a) low-income economies

(b) lower-middle-income economies

(d) high-income economies

2. Which one of the following is NOT a characteristic of developing nations?

(a) Unequal income distribution

(b) More agrarian economies

(d) Higher infant mortality

3. A characteristic of a primary product is that the supply and demand are relatively price

(a) elastic

(b) unit elastic

(d) perfectly elastic

4. Developing nationsâ terms of trade (TOT) are worsening over time because

(a) relative prices of primary exports to imports are unstable and falling.

(b) relative prices of primary exports to imports are stable and falling

(d) the prices of their primary export product are rising over time.

5. Most developing countries acquire the necessary primary products by importing them from advanced nations.

True or false

violetbadger964

CAS EC 102 Study Guide - Midterm Guide: The World Factbook, Foreign Exchange Market, Positive Statement

CAS EC 102 Full Course Notes

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