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Final Pony 2011
N/A
28
Economics
Undergraduate 2
06/17/2014

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Cards

Term
Three central problems of the economy?
Definition
What to produce?
How to produce it?
For whom to produce it?
Term
What is marginal benefit?
Definition
Additional benefit above what you've already derived.
Term
What is economic reasoning based off?
Definition
The assumption that all actions and decisions have costs associated with them.
Term
Cohn focuses on coordination rather than security as the central point of the definition of economics. Why?
Definition
The quantity of goods and services depends on human action, and the ability to coordinate it.
Term
If a country specializes, harnessing it's comparative advantage, the PPC's slope will:
Definition
Be negative, but not constant.
Term
What is the (law)(concept) of decreasing marginal returns?
Definition
You've got to trade more and more of 'A' as you produce more of substitute 'B'.
Term
What point is most efficient on a PPC that's bowed out?
One that's bowed in?
What of points inside the curve?
Definition
If bowed out, produce at center
If bowed in, produce at EITHER end
If inside the curve, not producing at max efficiency.
Term
What is the Law of Demand?
Definition
Quantity Demanded rises as price falls.

As long as there is a shift only in price, the point moves ALONG the demand curve.
Term
What is constant along a demand curve?

What is not constant?
Definition
Constant: price of good, substitutes, income of consumer, etc.

Not constant: PRICE of the good in question (look at the axes).
Term
Get No. 15 on 'scan0006' explained
Definition
Term
Business cycles occur when:
Definition
Output fluctuates around its secular trend.
Term
What common buzzword is not a leading economic indicator? Why?
Definition
Growth rate of the GDP. Does not account for GDP per capita; population may be rising faster than GDP.
Term
What is the unemployment rate evaluated off of?
Definition
1. Size of the labor force
2. Number of people unemployed
Term
An increase in the labor force results in what?
Definition
1. Increase in the labor force participation rate
2. Decrease in the employment rate
Term
How do you calculate GDP?
Definition
The market value of an economy's final goods and services in a one-year period.
Term
What is included in GNP but not GDP?
Definition
Sales of an American company to American citizens.
Term
If you get a question asking for consumption, chances are the answer is___.
Definition
Not sufficient data
Term
Need to get No. 24 on 'scan0008' explained.
Definition
Term
What is the formula for Net Domestic Income?
Definition
C+I+G+X-M-depreciation
Term
Need to figure out what induced expenditures are
Definition
Term
The expenditures function does what?
Definition
Gives the relationship between induced expenditures and autonomous expenditures.
Term
Need to learn real expenditures / real income (no. 29, 30, 32 'scan0010')
Definition
Term
Which industry is not affected directly by the monetary policy?
Definition
Banking system
Term
What does an increase in the money supply result in?
Definition
Decrease in the price level.
Term
What can the US Central Bank do (3)?

What can it not do?
Definition
Advise the gov't on finance
Loan money to corp's
Loan money to banks

NOT create money
Term
What is unique about US money policy?
Definition
We use MONETARY policy ONLY, not fiscal.
Term
What is the legal limit to what a commercial bank can lend?
Definition
Excess Reserves(25% of deposits)
Term
Need to learn about Money Multiplier; best from homework (No. 40 'scan0012')
Definition
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