Term
| False about leader/follower countries? |
|
Definition
follower country can grow faster then leaders
1. Japan was a follower is now leader
2. China is a follower |
|
|
Term
| False about constant technology K/L? |
|
Definition
| as long as gross savings is above zero output will increase |
|
|
Term
| Bernanke: Chinas Growth Strategy |
|
Definition
| They purchase US currency , making there dollar appreciate and ours depreciate |
|
|
Term
| 1973 to 1995 United States productivity growth ? |
|
Definition
|
|
Term
| 1995 to 2000 United States productivity growth? |
|
Definition
| grew a lot because of technology |
|
|
Term
| 2007 B Quest article on why productivity jumped 42% in 2001 to 2004 |
|
Definition
| Bush ditched environment regulations and gave business the freedom to operate |
|
|
Term
| how does bureau of labor measure unemployment rate? |
|
Definition
| random sample of 60,000 households |
|
|
Term
| What is the natural rate of unemployment? |
|
Definition
| there will always be a frictional and structural rate around 4.5% |
|
|
Term
|
Definition
| Each 1% above NRU creates negative 2% output gap |
|
|
Term
| Is inflation perfectly anticipated? |
|
Definition
| its neutral because if its anticipated then there would be compensation for it |
|
|
Term
| what is false about the relationship concerning consumption and savings? |
|
Definition
| Marginal propensity to consume + average PC = 1 , completly false no relationship |
|
|
Term
| What is an investment demand curve? |
|
Definition
| the amount of investment that will occur with certain rates |
|
|
Term
| consumption = 465 I = 20 what is GDP? |
|
Definition
|
|
Term
| Increase that wont close recessionary gap? |
|
Definition
|
|
Term
| $100 billion dollar increase in gov spending vs $100 billion dollar in raising taxes? |
|
Definition
| Gov. spending is better for GDP because of a higher multiplier affect |
|
|
Term
|
Definition
| supply creates its own demand |
|
|
Term
| Not a valid explanation for aggraded demand slope? |
|
Definition
|
|
Term
| what is false about aggregate supply in the long run? |
|
Definition
| anything is flexible (everything is flexible is true) |
|
|
Term
|
Definition
| productivity went up 50% labor cost for cars only went up 35% |
|
|
Term
| an expansion of fiscal policy is? |
|
Definition
| reduce taxes or increase government spending |
|
|
Term
| what works as an automatic stabilizer? |
|
Definition
|
|
Term
| in 2007 debt was at 9 trillion, now? |
|
Definition
| increased 4 trillion, roughly 13 trillion |
|
|
Term
| why isnt the dollar a median of exchange? |
|
Definition
|
|
Term
| M2 includes everything except ? |
|
Definition
|
|
Term
| whats false about the federal reserve |
|
Definition
|
|
Term
|
Definition
| banks do not like to hold reserves |
|
|
Term
| given the reserve , how much will the money supply increase? |
|
Definition
| 20% of the reserve would mean half that |
|
|
Term
| why was there a 25% decrease in the M1 money supply 1929 - 1933 |
|
Definition
| more currency then deposits and excess reserves |
|
|
Term
| what are the two components of money demand? |
|
Definition
| transaction demand and asset demand for money |
|
|
Term
| if the quantity money demand is less than the money supply then...? |
|
Definition
| interest rates go down, price of bonds go up, and agret demand rises |
|
|
Term
| When the feds buy bonds..? |
|
Definition
| reserves increases, intrestrate goes down, investment spending rises, and aggret demand increases |
|
|
Term
| which risk is not eliminated by diversity? |
|
Definition
|
|
Term
| which risk is not eliminated by diversity? |
|
Definition
|
|
Term
| if arbitrage moves the price so that the expected return lays on the market line how should you invest |
|
Definition
|
|
Term
| shortrun Agret supply –Agret Demand curves after an oil shock |
|
Definition
| decline in wages shifting agret supply back to the right |
|
|
Term
|
Definition
| shows the lower unemployment rate the higher the inflation rate |
|
|
Term
|
Definition
| higher taxes lead to underground econimics rasing tax rates results in decrease tax revenue because people will work less |
|
|
