21 Questions
What is a potential consequence of increasing government spending to stimulate economic growth?
An increase in prices due to increased demand
What is a goal of supply-side policies, such as deregulation?
To improve the business environment and increase efficiency
Why might a government impose taxes on certain activities?
To discourage certain activities
What is a potential consequence of redistributive policies, such as progressive taxation?
Richer workers may feel unfairly penalized and emigrate
What is a goal of demand management policies, such as monetary and fiscal policy?
To stabilize the economy and manage aggregate demand
What is the main reason for the incidence of tax falling on the seller in an elastic good?
The price elasticity of demand is high
What is the formula to calculate the inflation rate using the Consumer Price Index (CPI)?
Inflation rate = (Weighted average price in year x / Weighted average price in base year) × 100
What is the primary consequence of hyperinflation?
Money fails to be a good store of value
What is the term for a decrease in the general price level of goods and services?
Deflation
What is the main indicator of the labour market?
Labour force participation rate
What is the consequence of unemployment on the economy?
Decrease in government tax revenues
What is the formula to calculate the Real GDP?
Real GDP = Nominal GDP / CPI × 100
What type of unemployment occurs during a recession?
Cyclical unemployment
What is the consequence of economic growth on the Real GDP per capita?
It increases the Real GDP per capita
What is the main goal of demand management policies?
To stabilize the overall level of economic activity
What type of unemployment occurs when consumer demand for goods and services changes with the seasons?
Seasonal Unemployment
What is the term for a significant decline in economic activity that lasts more than a few months?
Economic Recession
What is the main advantage of economic growth?
Increases the Standard of Living
What is the Human Development Index used to measure?
Human and Economic Development
What is the threshold value for high human development in the Human Development Index?
0.8
What are the three components of the Human Development Index?
Standard of living, life expectancy, and literacy rate
Test your understanding of seasonal unemployment, economic growth, and economic recession. Identify the factors that affect the economy and understand the importance of economic growth. Assess your knowledge of these key concepts in economics.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
