Texas A&M University(TAMU) ECON 203 Tests Bundle Set

Real GDP Growth Rate CORRECT ANSWER [real GDP per capita(cy)-Real GDP per capita(py)]/ (Real GDP per capita (py)) x 100% OR Nominal GDP Growth Rate- Inflation Rate- Population Rate Compounding Formula CORRECT ANSWER GDP(yearA)=GDP(YearB)x(1+Growth rate)^(A-B) Rule of 70 CORRECT ANSWER Years ...

Principles of Economics: People face trade-offs CORRECT ANSWER Have to make choices because of scarcity Scarcity CORRECT ANSWER A situation in which unlimited wants exceed the limited resources available to fulfill those wants Principles of Economics: The cost of something is what you give up ...

Production Possibility CORRECT ANSWER a countries production capabilities modeled by the PPF PPF (Production Possibilities Frontier) CORRECT ANSWER -Line or curve that shows all possible combos of 2 outputs Points on PPF CORRECT ANSWER -points outside line are unattainable -points within are ...

Who is not in the working age population? CORRECT ANSWER Young (less than 16 years old) Military Institutionalized population (prison, mental hospitals) Working age population (calculation) CORRECT ANSWER Labor Force + Not in the labor force Labor Force CORRECT ANSWER working-age people who ...

What is left out of official GDP measures? CORRECT ANSWER 1) Goods and services not exchanged in the markets 2) Underground economy - Cash, Not reported, Not Taxes (Legal and Illegal) 3) Environment (pollution affects the quality of life) 4) •Amount of leisure time affects the quality of life...

The Federal Reserve CORRECT ANSWER in charge of monetary policy in U.S., adjusts the money supply to help achieve its monetary policy goals Monetary CORRECT ANSWER increasing and decreasing amount of money in the economy Monetary Policy Goals CORRECT ANSWER e prices (low inflation) and maximum...

Working Age Population (WAP)= CORRECT ANSWER total pop.-young (less than 16)-military-institutionalized(prison, asylums) labor force= CORRECT ANSWER employed + unemployed unemployment CORRECT ANSWER someone wants to work, but cant find a job in the current market people who dont have jobs, ...

Multiplier effect CORRECT ANSWER The increase in consumer spending that occurs when spending by one person causes others to spend more too Disposable income CORRECT ANSWER Income left after paying taxes -consumption is based on the amount of disposable income -people usually consume part of the...

CPI Definition CORRECT ANSWER The average level of prices of goods typically bought by households. Inflation Rate Definition CORRECT ANSWER The percentage increase in the general price level. CPI Formula CORRECT ANSWER Cost of basket year 1/Cost of basket base year X 100 Inflation Rate Form...

What is the labor force? CORRECT ANSWER the sum of employed and unemployed workers in the economy; it includes adult (16+) non-institutional civilian population What does "not in the labor force" mean? CORRECT ANSWER they currently do not have a job and they are not currently actively looking for...

Define Saving CORRECT ANSWER Saving is when someone spends less than they earn and use the rest to buy stocks, bonds, or to put in a bank account. Define Investment CORRECT ANSWER Investment refers to the purchase of new capital such as equipment or buildings. What is the Financial System? COR...

What is economic growth rate? CORRECT ANSWER It is the annual % change in real GDP What are living standards measured by? CORRECT ANSWER Real GDP per capita Living Standards amongst countries CORRECT ANSWER Living standards vary greatly between different countries. The rankings change over tim...