Exam 2: Economics and Banking

What are some consequences of a high unemployment rate? What are some consequences of a low unemployment rate?

The gross national product (GNP)measures ________.

The price of a product or service is based entirely on its actual value.

In what way does monopolistic competition favor consumers?

The Fed relies primarily on changes in the reserve requirement (the minimum amount of money banks must hold in reserve to cover deposits)to ease or tighten the money supply.

Although the United States comes close to being a capitalist economy,it is considered a mixed economy because there is some government intervention.

The value of the CPI's "market basket" is determined by ________.

________ unemployment refers to a temporary state of unemployment in which workers move between jobs,careers,and locations.

In a planned economy,an individual's personal income dictates his or her spending choices.

The consumer price index (CPI)tracks changes in price at the wholesale level.

What is the purpose of the U.S.government's regulation of monopolies?

A continuous decrease in the level of prices over time is called ________.

The average total of goods and services required to maintain a particular standard of living is called ________.

The ________ is the most widely used indicator of economic growth in the world today.

________ refers to how much of a product or service people want to buy at any given time.

Macroeconomics is the study of how certain occurrences affect the economy as a whole.

In which part of the business cycle is the Federal Reserve most likely to increase the discount rate to discourage banks from borrowing?

A free market economy is one in which ________.

Holding all other factors constant,prices are set slightly above the point where supply equals demand.

The government allows ________ companies to operate as regulated monopolies.