Macroeconomics Chapter 10 MyMathLab
Pearson
Which of the following does NOT lead to long-run economic growth? - correct answer
A.
Increase in average wages
Potential GDP - correct answer B.
increases over time as technological change occurs.
C.
increases over time as the labor force grows.
What is the rule of 70? - correct answer divide 70 by the real GDP growth rate to find
the number of year for an economy to double in size
Firms that act as financial intermediaries match households that have excess funds with
firms that want to borrow funds. What other key services does the financial system
provide to savers and lenders? (Mark all that apply.) - correct answer A.
Collects and communicates information about borrowers to savers
B.
Allows savers to spread their money among many financial investments.
C.
Provides an easy method of exchanging a financial security for money.
"Saving money is not lending. How can it be? When I save my money, I put it in a bank.
I don't loan it out to someone else." - correct answer C.
incorrect. The supply of loanable funds is determined by household saving.
Private Savings Formula - correct answer Y+TR-C-T
Public Savings Formula - correct answer T-G-TR
GDP Formula - correct answer Y = C + I + G
What is the general relationship between the business cycle and unemployment and
inflation? - correct answer B. During an expansion, unemployment falls and inflation
increases.
During the expansion phase of the business cycle, production, employment, and income
- correct answer Increase
During the recession phase of the business cycle, production, employment, and income
- correct answer Decrease
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