Exam 10: Economic Growth, the Financial System, and Business Cycles

Private saving is defined as

Explain why the demand curve for loanable funds has a negative slope.

Retained earnings are sufficient to finance a firm's rapid expansion in a high-growth economy.

Liquidity refers to

Centrally-planned economies tend to grow more quickly than market economies.

There is public dissaving if

If the CPI is currently 202,what does this tell you about inflation between last year and this year?

Financial markets and financial intermediaries comprise the financial system.

The demand for loanable funds is determined by the willingness of ________ to borrow money to engage in new investment projects.

If technological change increases the profitability of new investment for firms,then the ________ curve for loanable funds will shift to the ________ and the equilibrium real interest rate will ________.

Increases in capital per hour worked cannot sustain high rates of economic growth unless accompanied by technological change.

Purchases of which of the following goods would be dramatically reduced during a recession?

During a recession,spending on ________ tends to fall more dramatically than spending on ________.

Article Summary According to the Office for National Statistics in the United Kingdom, productivity in the UK in 2012 was well below the average of the G7 countries, only faring better than Japan. The G7 is a group of the seven most industrialized countries, and includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. Compared to the G7 average, the UK was 16% less productive per hour worked, and output was 19% worse when measured on a per worker basis. The productivity gap was the largest for the UK since 1994. Worker productivity has increased in all of the G7 nations except for the UK since 2007, where it has fallen by two percentage points. The most productive workers were in the United States, where workers were 29 percentage points more productive per hour worked than in the UK. Source: "UK workers much less productive than others in the G7," Guardian, September 18, 2013. -Refer to the Article Summary.________ depend on increases in labor productivity.

In a closed economy,

In a closed economy,public saving plus private saving is equal to

Following the September 11,2001,terrorist attacks,the managers of many hotels expected a prolonged period of reduced travel and responded by laying off workers and postponing or canceling new construction.Isadore Sharp,the chairman and CEO of Four Seasons Hotels,decided to

The lengths of the recession and expansion phases and which sectors of the economy are most affected will rarely be the same in any two business cycles.

The only way the standard of living of the average person in a country can increase is if ________ increases faster than ________.

Figure 10-6 -Refer to Figure 10-6.The market is in equilibrium.If the government budget deficit rises,which of the following would you expect to see?