The term stagflation refers to a situation where:
There is high inflation and high unemployment simultaneously
There is low inflation and low unemployment simultaneously
There is high inflation and low unemployment simultaneously
There is low inflation and high unemployment simultaneously
Correct Answer :
A. There is high inflation and high unemployment simultaneously
Related Questions
The term open market operations refer to:
The buying and selling of government securities by the central bank to influence the money supply
The buying and selling of goods and services in international markets
The buying and selling of stocks in the stock market
The buying and selling of consumer goods in a free market economy
The term marginal propensity to save (MPS) refers to:
The change in saving resulting from a change in disposable income
The total amount of saving in an economy
The change in consumption resulting from a change in disposable income
The total amount of consumption in an economy
The term hyperinflation refers to:
An extremely high and rapidly increasing inflation rate
A moderate and stable inflation rate
A period of deflation in the economy
A period of steady economic growth
Which of the following is a component of aggregate expenditure in the economy?
Government transfers
Taxes
Consumption
Imports
The term automatic stabilizers refers to:
Government policies that automatically adjust to stabilize the economy during economic fluctuations
The tools used by the central bank to stabilize the money supply
The policies implemented by the government to control inflation
The policies implemented by the government to control unemployment
If the government implements expansionary fiscal policy, it will likely lead to:
Higher inflation and higher economic growth
Lower inflation and lower economic growth
Higher inflation and lower economic growth
Lower inflation and higher economic growth
The term economic rent refers to:
Payment for the use of land or other natural resources that is in excess of what is needed to bring the resource into production
The payment for the use of capital goods in production
The total revenue earned by a firm
The total cost of producing a good or service
The term monetary base refers to:
The total amount of money in circulation in an economy
The total amount of money held by banks as reserves
The total amount of money held by households and businesses
The total amount of money created by the central bank
The term equilibrium level of income is determined by the intersection of:
Aggregate demand and aggregate supply
Consumption and saving
Investment and government spending
Taxes and transfers
Which of the following is a measure of the total value of all final goods and services produced within a country in a given period of time?
Gross Domestic Product (GDP)
Consumer Price Index (CPI)
Money Supply (M2)
Aggregate Demand (AD)
The term price elasticity of supply measures:
The responsiveness of quantity supplied to changes in price
The responsiveness of quantity demanded to changes in price
The responsiveness of consumer preferences to changes in price
The responsiveness of production costs to changes in price
Which of the following is a component of aggregate supply?
Consumption
Government spending
Investment
Wages and salaries
Which of the following is a measure of income inequality?
Gini coefficient
Consumer Price Index (CPI)
Producer Price Index (PPI)
Lorenz curve
The term marginal cost refers to:
The additional cost of producing one more unit of a good or service
The total cost of producing a given quantity of a good or service
The average cost of producing all units of a good or service
The fixed cost of producing a given quantity of a good or service
The term stagflation refers to a situation where:
There is high inflation and high unemployment simultaneously
There is low inflation and low unemployment simultaneously
There is high inflation and low unemployment simultaneously
There is low inflation and high unemployment simultaneously
The term cost-push inflation is caused by:
An increase in production costs that leads to higher prices
An increase in consumer demand for goods and services
An increase in government spending on infrastructure projects
An increase in the money supply by the central bank
The Phillips curve depicts the relationship between:
Inflation and unemployment
Government spending and taxes
Savings and investment
Consumption and income
The term deflation refers to:
A decrease in the overall price level of goods and services in an economy
An increase in the overall price level of goods and services in an economy
A decrease in the purchasing power of a currency
An increase in the purchasing power of a currency
The term capital gains tax is a tax on:
Profits earned from selling an asset, like a stock or real estate, at a higher price than it was purchased
Profits earned from producing and selling goods and services
Wages earned from labor
Interest earned from savings accounts
If the government increases taxes and decreases government spending, it is implementing:
Contractionary fiscal policy
Expansionary fiscal policy
Contractionary monetary policy
Expansionary monetary policy
The term money multiplier refers to:
The ratio of the change in the money supply to the change in the monetary base
The ratio of government spending to the level of GDP
The ratio of taxes to disposable income
The ratio of investment to savings in an economy
The term budget constraint refers to:
The limit on the total amount of money a consumer can spend
The limit on the total amount of money a government can borrow
The limit on the total amount of money a firm can invest
The limit on the total amount of money a central bank can print
The term Phillips curve depicts the relationship between:
Inflation and unemployment
Government spending and taxes
Savings and investment
Consumption and income
The term market equilibrium refers to a situation where:
The quantity supplied is equal to the quantity demanded in a market
The quantity supplied exceeds the quantity demanded in a market
The quantity demanded exceeds the quantity supplied in a market
The price level is constant in a market
The term deficit spending refers to a situation where:
The government's expenditures exceed its revenues in a given period
The government's revenues exceed its expenditures in a given period
The government's expenditures are equal to its revenues in a given period
The government borrows money from the central bank
The term money multiplier refers to:
The ratio of the change in the money supply to the change in the monetary base
The ratio of government spending to the level of GDP
The ratio of taxes to disposable income
The ratio of investment to savings in an economy
The term commodity bundle in economics refers to:
A collection of goods and services used to calculate inflation
A collection of goods and services that a consumer typically buys
A collection of goods and services used to calculate GDP
A collection of goods and services produced in a specific industry
The term tax incidence refers to:
The way in which the burden of a tax is shared between buyers and sellers in a market
The total amount of revenue collected by the government from taxes
The impact of a tax on the overall level of prices in an economy
The distribution of income among different households in an economy
Which of the following is a measure of the responsiveness of quantity demanded to a change in price?
Price elasticity of demand
Cross-price elasticity of demand
Income elasticity of demand
Price elasticity of supply
The Federal Reserve's main tool for controlling the money supply is:
Open market operations
Reserve requirements
Discount rates
Government spending