Home
Flashcards
Preview
ECON 131 Review
Home
Get App
Take Quiz
Create
Unanticipated inflation is good for borrowers
What causes the shape of the PPC to be bowed?
Increasing Opportunity Costs
What is the largest portion of the current account?
Imports and Exports
What are unilateral transfers?
Gifts from one country to another
What is the largest component of GDP?
Personal Consumption Expenditures
Labor Productivity refers to output per worker
Classical Model
Long Run Equilibrium
Flexible Wages
Unanticipated inflation is good for borrowers
Keynesian Economics
Government Intervention can stabilize the Economy
Prices are sticky
Changes in AD have their greatest Short run effect on real output and employment
Two tools of Fiscal Policy
Government Expenditures
Taxes
Adverse Selection
The potential for borrowers to use the borrowed funds in high risk situations
What is an important factor that affects the rate of economic growth and hence long term living standards
Rate of Saving
Saving is important to Economic growth because without saving we cannot have investment
How to calculate Real rate of interest
Nominal rate of interest - anticipated rate of inflation
comparative advantage
those who have a smaller opportunity cost
Absolute Advantage
More output per unit of input
National Income Accounting
A measurement system use to estimate national income and its components
What does GDP not include?
Financial Transactions
Transfer Payments
Secondhand Goods
GDP is not a measure of a nation's overall welfare
Two ways to measuring GDP
Expenditure Approach
Income Approach
Expenditure Approach
add the dollar value of all final goods and services
Income Approach
Add the income received by all factors of production
Add up all components of national income, including wages, interest, rent, and profits
Examples of Automatic Stabilizers
Unemployment
Welfare
Tax Structure
Four Functions of Money
Medium of Exchange
Unit of Accounting
Store of value
Standard of Deferred Payment
Three functions of Central Banks
Conduct Nation's monetary policy
Provide Currency to nation
act as government fiscal agent
8 functions of the Fed
Supplies economy with Fiduciary currency
holds depository institutions' reserves and provides payment clearing systems
acts as the government's fiscal agent
supervises depository institutions
conducts monetary policy
intervenes in foreign currency markets
acts as a lender of last resort
3 tools of the Fed
OMO
Discount Rate
Reserve Requirement Ratio
3 reasons for money demand
Transactions demand
Precautionary Demand
Asset Demand
Author
jo73
ID
291618
Card Set
ECON 131 Review
Description
adsf
Updated
12/15/2014, 9:09:42 AM
Show Answers
Home
Flashcards
Preview