ECON 1000 Chapter Notes - Chapter 23: Capital Market, European Route E70, Bundesautobahn 63
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Related Questions
1. Which of the following groups of countries are all advanced economies?
Ā | Ā |
Hong Kong, Japan, France, and the United Kingdom |
Ā | Ā |
Italy, the United States, China, and Russia |
Ā | Ā |
Singapore, Russia, France, and Chad |
Ā | Ā |
Australia, Brazil, and the United States |
QUESTION 2
1. The most people live in ________ economies and the fewest people live in ________ economies.
Ā | Ā |
developing; emerging market |
Ā | Ā |
advanced; emerging market |
Ā | Ā |
emerging market; developing |
Ā | Ā |
advanced; developing |
QUESTION 3
1. Households and firms in the U.S. economy interact with those in the rest of the world in the ________ market and the ________ market.
Ā | Ā |
goods; financial |
Ā | Ā |
government; goods |
Ā | Ā |
goods; factor |
Ā | Ā |
financial; factor |
QUESTION 4
1. As a factor of production, oil reserves are counted as
Ā | Ā |
labor. |
Ā | Ā |
capital. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
land. |
QUESTION 5
1. ________ the owners of the factors of production, while ________ what amounts of those factors to hire.
Ā | Ā |
Households are; the government determines |
Ā | Ā |
Firms are; households that determine |
Ā | Ā |
The government is; firms determine |
Ā | Ā |
Households are; firms that determine |
QUESTION 6
1. The emerging market economies are
Ā | Ā |
the nations that are currently agricultural in nature. |
Ā | Ā |
most of the nations of Western Europe. |
Ā | Ā |
the largest grouping including the nations of China and India. |
Ā | Ā |
in the transition from state-owned production to free markets. |
QUESTION 7
1. In the United States, the productive factor that, as a group, receives the largest fraction of the nation's total income was
Ā | Ā |
consumption of goods and services. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
capital. |
Ā | Ā |
labor. |
QUESTION 8
1. Items bought by individuals to provide personal enjoyment are termed
Ā | Ā |
personal goods. |
Ā | Ā |
consumption of goods. |
Ā | Ā |
consumption or investment goods. |
Ā | Ā |
standard goods. |
QUESTION 9
1. In the advanced economies, ________ of the factories use advanced capital equipment and in the developing economies ________ of the factories use advanced capital equipment
Ā | Ā |
virtually all; none |
Ā | Ā |
some; some |
Ā | Ā |
virtually all; virtually all |
Ā | Ā |
virtually all; some |
QUESTION 10
1. The productive resource that includes all the "gifts of nature" is called
Ā | Ā |
land. |
Ā | Ā |
labor. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
capital. |
QUESTION 11
1. What would be an example of government good?
Ā | Ā |
Donald Trump purchases furniture for his office. |
Ā | Ā |
Antonio, the manager of the local Taco Hut, purchases a new deep fryer. |
Ā | Ā |
The local driver's license office purchases a new digital camera and printer. |
Ā | Ā |
Jake buys an iPhone. |
QUESTION 12
1. The world population is approximately ________ people.
Ā | Ā |
2 trillion |
Ā | Ā |
680 million |
Ā | Ā |
6.8 billion |
Ā | Ā |
6.8 million |
QUESTION 13
1. Computers and insurance coverage produced in the United States and sold to people in other nations are categorized as
Ā | Ā |
U.S. exports of goods and services. |
Ā | Ā |
U.S. government goods and services. |
Ā | Ā |
foreign capital goods. |
Ā | Ā |
U.S. consumer goods and services. |
QUESTION 14
1. Of the following, the federal government obtains most revenue from
Ā | Ā |
corporate income taxes. |
Ā | Ā |
excise taxes. |
Ā | Ā |
sales taxes. |
Ā | Ā |
social security taxes. |
QUESTION 15
1. Items bought by businesses to help produce other goods and services are called
Ā | Ā |
capital goods. |
Ā | Ā |
government goods and services. |
Ā | Ā |
consumption of goods and services. |
Ā | Ā |
exports of goods and services. |
QUESTION 16
1. The majority of the income earned in the United States is paid in
Ā | Ā |
profit. |
Ā | Ā |
interest. |
Ā | Ā |
rent. |
Ā | Ā |
wages. |
QUESTION 17
1. Dan missed class the day the professor covered the circular flow model. Dan asked his friend Joan to explain markets to him. Joan correctly stated that a market
Ā | Ā |
must include a written contract between buyers and sellers. |
Ā | Ā |
requires a physical location for buyers and sellers to get together. |
Ā | Ā |
is only a place to purchase groceries. |
Ā | Ā |
is an arrangement that brings buyers and sellers together. |
QUESTION 18
1. The United States possesses a large amount of human capital. As a result of this fact, in the United States, there is a
Ā | Ā |
highly skilled and educated labor force. |
Ā | Ā |
a large number of kind and generous humans. |
Ā | Ā |
a large number of people and a great deal of land. |
Ā | Ā |
a large amount of machinery and equipment. |
QUESTION 19
1. Which of the following correctly lists the categories of factors of production?
Ā | Ā |
labor, machines, buildings, capital, and entrepreneurship |
Ā | Ā |
land, buildings, capital, and entrepreneurship |
Ā | Ā |
land, labor, capital, and entrepreneurship |
Ā | Ā |
forests, fish, buildings, capital, and entrepreneurship |
QUESTION 20
1. Which of the following correctly lists the categories of factors of production?
Ā | Ā |
capital, money, and labor |
Ā | Ā |
hardware, software, land, and money |
Ā | Ā |
land, labor, capital, and entrepreneurship |
Ā | Ā |
machines, buildings, land, and money |
QUESTION 21
1. In the United States, the poorest 20 percent of households receive roughly ________ percent of total income.
Ā | Ā |
10 |
Ā | Ā |
3 |
Ā | Ā |
15 |
Ā | Ā |
20 |
QUESTION 22
1. What would be an example of a consumption service?
Ā | Ā |
Jake buys an iPhone. |
Ā | Ā |
The local driver's license office purchases a new digital camera and printer. |
Ā | Ā |
Antonio, the manager of the local Taco Hut, purchases a new deep fryer. |
Ā | Ā |
Rhianna gets a haircut. |
QUESTION 23
1. The total value of capital in the United States is around
Ā | Ā |
$47 trillion. |
Ā | Ā |
$10 trillion. |
Ā | Ā |
$100 trillion. |
Ā | Ā |
$79 trillion. |
QUESTION 24
1. An export good is a good produced
Ā | Ā |
by foreigners in the United States and purchased by U.S. households. |
Ā | Ā |
in another country and purchased by U.S. residents. |
Ā | Ā |
in the United States and sold to foreigners living in the United States. |
Ā | Ā |
in the United States and sold in other countries. |
QUESTION 25
1. ________ paid for the use of land; ________ paid for the services of labor; and ________ paid for the use of capital.
Ā | Ā |
Interest is; wages are; profit is |
Ā | Ā |
Rent is; wages are; interest is |
Ā | Ā |
Rent is; interest is; wages are |
Ā | Ā |
Mortgages are; interest is; wages are |
1. Which of the following groups of countries are all advanced economies?
Ā | Ā |
Hong Kong, Japan, France, and the United Kingdom |
Ā | Ā |
Italy, the United States, China, and Russia |
Ā | Ā |
Singapore, Russia, France, and Chad |
Ā | Ā |
Australia, Brazil, and the United States |
QUESTION 2
1. The most people live in ________ economies and the fewest people live in ________ economies.
Ā | Ā |
developing; emerging market |
Ā | Ā |
advanced; emerging market |
Ā | Ā |
emerging market; developing |
Ā | Ā |
advanced; developing |
QUESTION 3
1. Households and firms in the U.S. economy interact with those in the rest of the world in the ________ market and the ________ market.
Ā | Ā |
goods; financial |
Ā | Ā |
government; goods |
Ā | Ā |
goods; factor |
Ā | Ā |
financial; factor |
QUESTION 4
1. As a factor of production, oil reserves are counted as
Ā | Ā |
labor. |
Ā | Ā |
capital. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
land. |
QUESTION 5
1. ________ the owners of the factors of production, while ________ what amounts of those factors to hire.
Ā | Ā |
Households are; the government determines |
Ā | Ā |
Firms are; households determine |
Ā | Ā |
The government is; firms determine |
Ā | Ā |
Households are; firms determine |
QUESTION 6
1. The emerging market economies are
Ā | Ā |
the nations that are currently agricultural in nature. |
Ā | Ā |
most of the nations of Western Europe. |
Ā | Ā |
the largest grouping including the nations of China and India. |
Ā | Ā |
in the transition from state-owned production to free markets. |
QUESTION 7
1. In the United States, the productive factor that, as a group, receives the largest fraction of the nation's total income was
Ā | Ā |
consumption of goods and services. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
capital. |
Ā | Ā |
labor. |
QUESTION 8
1. Items bought by individuals to provide personal enjoyment are termed
Ā | Ā |
personal goods. |
Ā | Ā |
consumption of goods. |
Ā | Ā |
consumption or investment goods. |
Ā | Ā |
standard goods. |
QUESTION 9
1. In the advanced economies, ________ of the factories use advanced capital equipment and in the developing economies ________ of the factories use advanced capital equipment
Ā | Ā |
virtually all; none |
Ā | Ā |
some; some |
Ā | Ā |
virtually all; virtually all |
Ā | Ā |
virtually all; some |
QUESTION 10
1. The productive resource that includes all the "gifts of nature" is called
Ā | Ā |
land. |
Ā | Ā |
labor. |
Ā | Ā |
entrepreneurship. |
Ā | Ā |
capital. |
QUESTION 11
1. What would be an example of government good?
Ā | Ā |
Donald Trump purchases furniture for his office. |
Ā | Ā |
Antonio, the manager of the local Taco Hut, purchases a new deep fryer. |
Ā | Ā |
The local driver's license office purchases a new digital camera and printer. |
Ā | Ā |
Jake buys an iPhone. |
QUESTION 12
1. The world population is approximately ________ people.
Ā | Ā |
2 trillion |
Ā | Ā |
680 million |
Ā | Ā |
6.8 billion |
Ā | Ā |
6.8 million |
QUESTION 13
1. Computers and insurance coverage produced in the United States and sold to people in other nations are categorized as
Ā | Ā |
U.S. exports of goods and services. |
Ā | Ā |
U.S. government goods and services. |
Ā | Ā |
foreign capital goods. |
Ā | Ā |
U.S. consumer goods and services. |
QUESTION 14
1. Of the following, the federal government obtains most revenue from
Ā | Ā |
corporate income taxes. |
Ā | Ā |
excise taxes. |
Ā | Ā |
sales taxes. |
Ā | Ā |
social security taxes. |
QUESTION 15
1. Items bought by businesses to help produce other goods and services are called
Ā | Ā |
capital goods. |
Ā | Ā |
government goods and services. |
Ā | Ā |
consumption of goods and services. |
Ā | Ā |
exports of goods and services. |
QUESTION 16
1. The majority of the income earned in the United States is paid in
Ā | Ā |
profit. |
Ā | Ā |
interest. |
Ā | Ā |
rent. |
Ā | Ā |
wages. |
QUESTION 17
1. Dan missed class the day the professor covered the circular flow model. Dan asked his friend Joan to explain markets to him. Joan correctly stated that a market
Ā | Ā |
must include a written contract between buyers and sellers. |
Ā | Ā |
requires a physical location for buyers and sellers to get together. |
Ā | Ā |
is only a place to purchase groceries. |
Ā | Ā |
is an arrangement that brings buyers and sellers together. |
QUESTION 18
1. The United States possesses a large amount of human capital. As a result of this fact, in the United States, there is a
Ā | Ā |
highly skilled and educated labor force. |
Ā | Ā |
a large number of kind and generous humans. |
Ā | Ā |
a large number of people and a great deal of land. |
Ā | Ā |
a large amount of machinery and equipment. |
QUESTION 19
1. Which of the following correctly lists the categories of factors of production?
Ā | Ā |
labor, machines, buildings, capital, and entrepreneurship |
Ā | Ā |
land, buildings, capital, and entrepreneurship |
Ā | Ā |
land, labor, capital, and entrepreneurship |
Ā | Ā |
forests, fish, buildings, capital, and entrepreneurship |
QUESTION 20
1. Which of the following correctly lists the categories of factors of production?
Ā | Ā |
capital, money, and labor |
Ā | Ā |
hardware, software, land, and money |
Ā | Ā |
land, labor, capital, and entrepreneurship |
Ā | Ā |
machines, buildings, land, and money |
QUESTION 21
1. In the United States, the poorest 20 percent of households receive roughly ________ percent of total income.
Ā | Ā |
10 |
Ā | Ā |
3 |
Ā | Ā |
15 |
Ā | Ā |
20 |
QUESTION 22
1. What would be an example of a consumption service?
Ā | Ā |
Jake buys an iPhone. |
Ā | Ā |
The local driver's license office purchases a new digital camera and printer. |
Ā | Ā |
Antonio, the manager of the local Taco Hut, purchases a new deep fryer. |
Ā | Ā |
Rhianna gets a haircut. |
QUESTION 23
1. The total value of capital in the United States is around
Ā | Ā |
$47 trillion. |
Ā | Ā |
$10 trillion. |
Ā | Ā |
$100 trillion. |
Ā | Ā |
$79 trillion. |
QUESTION 24
1. An export good is a good produced
Ā | Ā |
by foreigners in the United States and purchased by U.S. households. |
Ā | Ā |
in another country and purchased by U.S. residents. |
Ā | Ā |
in the United States and sold to foreigners living in the United States. |
Ā | Ā |
in the United States and sold in other countries. |
QUESTION 25
1. ________ paid for the use of land; ________ paid for the services of labor; and ________ paid for the use of capital.
Ā | Ā |
Interest is; wages are; profit is |
Ā | Ā |
Rent is; wages are; interest is |
Ā | Ā |
Rent is; interest is; wages are |
Ā | Ā |
Mortgages are; interest is; wages are |
Q1. The total resource cost of goods and services produced by the U. S. economy is known as a. real GDP b. personal income c. national wealth d. national income Q2. The difference between GDP and final sales equals a. depreciation b. exports c. imports d. net inventory change Q3. Current disposable income can be adjusted for price changes and population changes to yield real per capita disposable income. a. true b. false Q4. If a lawn service mows your grass, it is included in the GDP. a. true b. false Q5. In national income accounting, grain fed to a hog at a commercial hog farm is considered a(n) a. final good b. intermediate good c. consumer good d. capital consumption allowance Q6. Imports constitute a minus figure in national income accounting. a. true b. false Q7. The total value added in the production of a final good a. exceeds the price of the final good b. equals the price of the final good c. exceeds the total payments made to owners of productive resources used in the production d. both (b) and (c) Q8. The GDP is reported on a monthly basis by the Department of Commerce. a. true b. false Q9. Transfer payments are added to NI in the process of determining personal income. a. true b. false Q10. U.S. gross domestic product is converted to U.S. gross national product by a. adding the value of output produced by U.S.-owned resources in foreign countries b. subtracting the value of output produced by U.S.-owned resources in foreign countries c. subtracting the value of output produced in the United States by foreign-owned resources d. both (a) and (c) Q11. Final sales are always larger than the GDP. a. true b. false Q12. Because of the value of things produced inside households, (building your own desk, mowing your own lawn, etc.) a. the GDP value is automatically adjusted upward to reflect this b. the GDP value is automatically adjusted downward to reflect this c. Official GDP is surely smaller than true total output d. Official GDP is surely larger than true total output Q13. A government surplus may trigger a decline in the money supply. a. true b. false Q14. Real wages are determined by multiplying money wages by the CPI. a. true b. false Q15. The more volatile the inflation rate, the weaker the money supply as a standard of deferred payment. a. true b. false Q16. An increase in the money supply always causes an increase in the price level. a. true b. false Q17. Your nominal wages rose during the same period from $200 a week to $260. By how much did your real income rise? a. 30 percent b. 16.7 percent c. 8.33 percent d. 12 percent Q18. In the past 10 years or so, average real wages of U.S. workers in nonagricultural industries have a. increased about 40 percent b. increased slightly c. remained about the same d. declined Q19. If a new cash deposit creates excess reserves of $5,000 and the required reserve ratio is 10 percent, the banking system can increase the money supply by a maximum of a. $50,000 b. $500 c. $5,000 d. $4,500 Q20. The effect of a change in the money supply on economic activity may be offset by a change in velocity. a. true b. false Q21. The current base period for the CPI is a. 1967 b. 1977 c. 1982Ć¢ĀĀ1984 d. 1990 Q22. In the circular flow, an increase in the money supply tends to result when a. planned I equals planned S b. planned I is less than planned S c. planned I is greater than planned S d. there is a surplus government budget Q23. COLA is a form of indexation. a. true b. false Q24. The total checkable deposits a bank may have can be determined by dividing its reserves by the reserve requirement. a. true b. false Q25. The Financial Services Modernization Act a. reinforced the Glass Steagall Act b. prevented mergers of banks c. eliminated barriers between banks, brokerage houses, and insurance companies d. eliminated all banking regulations Q26. Each Federal Reserve Bank has its own board of directors. a. true b. false Q27. The most frequently used tool of U.S. monetary policy is a. the discount rate b. the reserve requirement c. open-market operations d. moral suasion Q28. When the Fed conducts open-market operations, it primarily uses a. Treasury bills b. long-term U.S. government bonds c. bonds of publicly traded corporations d. overnight loans of major banks Q29. The Board of Governors of the Federal Reserve System has a. 6 members b. 7 members c. 1 member from each Federal Reserve Bank d. 20 members Q30. If the Fed desires to increase checkable deposits, it may lower the reserve requirement. a. true b. false Q31. The interest rate at which banks borrow excess reserves from each other is known as the a. prime rate b. federal funds rate c. discount rate d. T-bill rate Q32. If member banks need to borrow reserves, they must do so through the discount window. a. true b. false Q33. The Fed Chairman appears before Congress semi-annually to present the Monetary Policy Report. a. true b. false Q34. In terms of the total number of payments, which of the following comprises the largest share? a. cash b. personal checks c. debit cards d. credit cards Q35. By buying government securities, the Federal Open Market Committee adds to member banks' reserves. a. true b. false Q36. More than 50 percent of commercial banks in the United States belong to the Federal Reserve System. a. true b. false Q37. The Federal Reserve System is built around a. 4 regional banks b. 6 regional banks c. 12 district banks d. 1 bank with several branches Q38. The time lags lead monetarists to contend that monetary policy is counterproductive. a. true b. false Q39. The marginal propensity to consume is a. the fraction of an increase in income that would be spent on consumer goods b. the additional desire people have for consumer goods c. the fraction of a person's total income normally spent for consumer goods d. the change in consumption resulting from a $1 change in the price level Q40. The consumption function shows a. how fast the economy is consuming its capital b. that the amount of national income determines the rate at which the economy consumes its resources c. that households' incomes determine how much the households will spend for consumer goods d. the rate at which people actually use up their consumer goods Q41. In the simple Keynesian model, if output exceeds aggregate expenditures, a. there will be no response from businesses b. inventories will decrease and businesses will increase output c. inventories will increase and businesses will increase output d. inventories will increase and businesses will decrease output Q42. If planned construction investment increases by $30 billion and the MPC is two-thirds, total output will increase by a. $30 billion b. $20 billion c. $45 billion d. $90 billion Q43. "A given change in business investment will cause a larger change in equilibrium output." This statement describes an important Keynesian concept called the a. multiplier effect b. marginal propensity to consume c. marginal propensity to invest d. consumption function Q44. In the multiplier formula, 1/MPS equals the multiplier. a. true b. false Q45. The classical economists held that chronic unemployment was likely. a. true b. false Q46. As income increases, the absolute level of planned consumption will increase. a. true b. false Q47. The new classical school contends that government fiscal policy is better than monetary policy in controlling inflation. a. true b. false Q48. Higher price levels are associated with lower aggregate expenditure at every level of income. a. true b. false Q49. Any time that planned leakages exceed planned injections, the economy will expand. a. true b. false Q50. According to the Keynesian model, increased foreign spending for U.S. goods is likely to a. reduce total employment in the United States b. increase total employment in the foreign country c. reduce total output in the United States d. increase total output in the United States |