Exam 2: Understanding Basic Economics

________ taxes are levied on earnings of individuals to help fund Social Security,Medicare,and unemployment compensation.

When a downward swing or recession is over,the economy enters into a period of ________.

________ taxes,levied on retail purchases made by customers,are collected by retail businesses at the time of the sale and then forwarded to state governments.

The point at which the demand and supply curves intersect - the point at which the quantity demanded and supplied are equal - is called the ________.

The term ________ is defined as having two consecutive quarters of decline in the country's gross domestic product.

The study of a country's larger economic issues,such as how firms compete,the effect of government policies,and how an economy maintains and allocates its scarce resources,is known as ________.

The ________ depicts the relationship between prices and quantities that sellers will offer for sale,regardless of demand.

How does capitalism promote monopolistic competition in the market?

Which of the following types of unemployment is common in industries with predictable increases and decreases in customer demand?

GDP considers who is responsible for the production; GNP considers where the production occurs.

Explain the meaning of a leading indicator with the help of an example.

Differentiate between structural and cyclical unemployment.

________ policy involves adjusting the nation's money supply by increasing or decreasing interest rates.

A deep and prolonged recession is known as a(n)________.

A deep and prolonged recession can be considered as a depression.

The economic system of the U.S.is such that individuals own and operate the majority of businesses with limited economic intervention by the government.This is characteristic of a ________ economy.

________ refers to the amount of a good or service that customers will buy at a given time.

In a country,the government owns many of the key industrial sectors,such as transportation,health care,and communications.Private ownership,however,is allowed in other industries.What type of economic system does this country have?

________ is a situation in which no single firm is large enough to influence prices and distort the workings of the free-market system.

Deciding how much money to spend on new manufacturing equipment versus launching a new advertising campaign is described as opportunity cost.