Test Bank for Macroeconomics for Today 11th Edition Tucker
Test Bank for Macroeconomics for Today, 11th Edition, Irvin B. Tucker, ISBN: 9780357721094
Table of Contents
CHAPTER 1. INTRODUCING THE ECONOMIC WAY OF THINKING
1-1. Economics: The Study of Scarcity and Choice
1-1a. The Problem of Scarcity
1-1b. Scarcity and Economics
1-2. Three Fundamental Economic Questions
1-2a. What to Produce?
1-2b. How to Produce?
1-2c. For Whom to Produce?
1-3. The Methodology of Economics
Step 1: Identify the Problem
1-4. Hazards of the Economic Way of Thinking
1-4a. The Ceteris Paribus Assumption
1-4b. Correlation versus Causation
1-5. Why Do Economists Disagree?
1-5a. Efficiency versus Equity
1-5b. Positive versus Normative Economics
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
Appendix to Chapter 1. Applying Graphs to Economics
CHAPTER 2. PRODUCTION POSSIBILITIES, OPPORTUNITY COST, AND ECONOMIC GROWTH
2-1. Opportunity Cost
2-2. Marginal Analysis
2-3. The Production Possibilities Model
2-3a. Assumptions
2-3b. The Production Possibilities Curve
2-3c. Efficiency and the Production Possibilities Curve
2-4. Opportunity Cost and the Production Possibilities Curve
2-4a. Identifying Opportunity Cost Using the PPC Model
2-4b. The Law of Increasing Opportunity Cost
2-5. Sources of Economic Growth
2-5a. Changes in Resources
2-5b. Technological Change
2-5c. Present Investment in Capital
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
ROAD MAP FOR CHAPTERS 1 AND 2
CHAPTER 3. MARKET DEMAND AND SUPPLY
3-1. Demand
3-1a. The Demand Curve
3-1b. Market Demand
3-1c. Shifts of the Demand Curve
3-1d. Caution! Movement Along versus Shift of the Demand Curve
3-2. Supply
3-2a. The Supply Curve
3-2b. Market Supply
3-2c. Shifts of the Supply Curve
3-2d. Caution! Movement Along versus Shift of the Supply Curve
3-3. Market Equilibrium
3-3a. Surplus versus Shortage
3-3b. Equilibrium Price and Quantity
3-3c. Rationing Function of the Price System
3-4. Changes in Market Equilibrium
3-4a. Changes in Demand
3-4b. Changes in Supply
3-4c. Simultaneous Changes in Demand and Supply
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 4. MARKETS IN ACTION
4-1. Market Efficiency
4-2. Sources of Market Failure
4-2a. Lack of Competition
4-2b. Externalities
4-2c. Public Goods
4-3. Policies to Correct Market Failure
4-3a. Regulation
4-3b. Price Controls
4-3c. Taxes and Subsidies
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
Appendix to Chapter 4. Consumer Surplus, Producer Surplus, and Market Efficiency
ROAD MAP FOR CHAPTERS 3, 4
CHAPTER 5. GROSS DOMESTIC PRODUCT
5-1. Gross Domestic Product
5-1a. GDP Counts Only New Domestic Production
5-1b. GDP Counts Only Final Goods
5-2. Measuring GDP
5-2a. The Circular Flow Model
5-2b. Flow versus Stock
5-3. The Expenditure Approach
5-3a. Personal Consumption Expenditures (C)
5-3b. Gross Private Domestic Investment (I)
5-3c. Government Consumption Expenditures and Gross Investment (G)
5-3d. Net Exports (X-M)
5-3e. A Formula for GDP
5-4. The Income Approach
5-4a. Compensation of Employees
5-4b. Rental Income
5-4c. Profits
5-4d. Net Interest
5-4e. Indirect Business Taxes
5-4f. Depreciation
5-4g. GDP in Other Countries
5-5. GDP Shortcomings
5-5a. Nonmarket Transactions
5-5b. Distribution, Kind, and Quality of Products
5-5c. Neglect of Quality of Life
5-5d. The Underground Economy
5-5e. Negative Externalities
5-5f. GDP Alternatives
5-6. Other National Income Accounts
5-6a. National Income (NI)
5-6b. Personal Income (PI)
5-6c. Disposable Personal Income (DI)
5-7. Changing Nominal GDP to Real GDP
5-7a. The GDP Chain Price Index
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
Appendix to Chapter 5. A Four-Sector Circular Flow Model
CHAPTER 6. BUSINESS CYCLES AND UNEMPLOYMENT
6-1. The Business–Cycle Roller Coaster
6-1a. The Four Phases of the Business Cycle
6-1b. Economic Growth
6-1c. Real GDP Growth Rates in Other Countries
6-1d. Business-Cycle Indicators
6-1e. Total Spending and the Business Cycle
6-2. Unemployment
6-2a. Measuring Unemployment
6-2b. Unemployment in Other Countries
6-2c. Unemployment Rate Criticisms
6-3. Types of Unemployment
6-3a. Frictional Unemployment
6-3b. Structural Unemployment
6-3c. Cyclical Unemployment
6-4. The Goal of Full Employment
6-4a. The GDP Gap
6-5. Nonmonetary and Demographic Consequences of Unemployment
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 7. INFLATION
7-1. Meaning and Measurement of Inflation
7-1a. The Consumer Price Index
7-1b. How the CPI Is Computed
7-1c. History of U.S. Inflation Rates
7-1d. Consumer Price Index Criticisms
7-2. Consequences of Inflation
7-2a. Inflation Shrinks Income
7-2b. Inflation and Wealth
7-2c. Inflation and the Real Interest Rate
7-2d. Inflation in Other Countries
7-2e. Inflation on a Rampage
7-3. Demand-Pull and Cost-Push Inflation
7-3a. Demand-Pull Inflation
7-3b. Cost-Push Inflation
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
ROAD MAP FOR CHAPTERS 5, 6, AND 7
CHAPTER 8. THE KEYNESIAN MODEL
8-1. Introducing Classical Theory and the Keynesian Revolution
8-1a. The Consumption Function
8-1b. Marginal Propensities to Consume and Save
8-1c. Graphical Analysis of MPC
8-2. Reasons the Consumption Function Shifts
8-2a. Expectations
8-2b. Wealth
8-2c. The Price Level
8-2d. The Interest Rate
8-3. Investment Expenditures
8-3a. The Investment Demand Curve
8-4. Why Investment Demand Is Unstable
8-4a. Expectations
8-4b. Technological Change
8-4c. Capacity Utilization
8-4d. Business Taxes
8-5. Investment as an Autonomous Expenditure
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 9. THE KEYNESIAN MODEL IN ACTION
9-1. Adding Government and Global Trade to the Keynesian Model
9-1a. Government Spending
9-1b. Net Exports
9-2. The Aggregate Expenditures Model
9-2a. The Aggregate Expenditures Function (AE)
9-2b. Tabular Analysis of Keynesian Equilibrium
9-2c. Graphical Analysis of Keynesian Equilibrium
9-3. The Spending Multiplier Effect
9-3a. Spending Multiplier Arithmetic
9-4. Recessionary and Inflationary Gaps
9-4a. Recessionary Gap
9-4b. Inflationary Gap
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 10. AGGREGATE DEMAND AND SUPPLY
10-1. The Aggregate Demand Curve
10-2. Reasons for the Aggregate Demand Curve’s Shape
10-2a. Real Balances Effect
10-2b. Interest-Rate Effect
10-2c. Net Exports Effect
10-3. Nonprice-Level Determinants of Aggregate Demand
10-4. The Aggregate Supply Curve
10-4a. Keynesian View of Aggregate Supply
10-4b. Classical View of Aggregate Supply
10-4c. Three Ranges of the Aggregate Supply Curve
10-5. Changes in AD–AS Macroeconomic Equilibrium
10-5a. Keynesian Range
10-5b. Intermediate Range
10-5c. Classical Range
10-5d. The AD–AS Model for 2008–2009 During the Great Recession and for the 2020 COVID-19 Recession
10-6. Nonprice-Level Determinants of Aggregate Supply
10-6a. Increase in Both Aggregate Demand and Aggregate Supply Curves
10-7. Cost-Push and Demand-Pull Inflation Revisited
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
Appendix to Chapter 10. The Self-Correcting Aggregate Demand and Supply Model
CHAPTER 11. FISCAL POLICY
11-1. Discretionary Fiscal Policy
11-1a. Increasing Government Spending to Combat a Recession
11-1b. Spending Multiplier Arithmetic Revisited
11-1c. Cutting Taxes to Combat a Recession
11-1d. Expansionary Fiscal Policy Can Create a Fiscal Deficit
11-1e. Using Fiscal Policy to Combat Inflation
11-1f. Contractionary Fiscal Policy Can Create a Fiscal Surplus
11-1g. The Balanced Budget Multiplier
11-2. Automatic Stabilizers
11-3. Supply-Side Fiscal Policy
11-3a. Keynesian Demand-Side versus Supply-Side Fiscal Policy
11-3b. Supply-Side Fiscal Policy Effects on the Labor Market
11-3c. Supply-Side Effects versus the Keynesian Demand-Side Effects of a Tax Cut
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 12. THE PUBLIC SECTOR
12-1. Government Size and Growth
12-1a. Government Expenditure Patterns
12-1b. Government Expenditures in Other Countries
12-2. Financing Government Budgets
12-2a. The Tax Burden in Other Countries
12-3. The Art of Taxation
23-3a. The Benefits-Received Principle
12-3b. The Ability-to-Pay Principle
12-3c. Progressive, Regressive, and Proportional Taxes
12-3d. Reforming the Tax System
12-4. Public Choice Theory
12-4a. Majority-Rule Problem
12-4b. Special-Interest Group Effect
12-4c. Rational Voter Ignorance
12-4d. Bureaucratic Inefficiency
12-4e. Shortsightedness Effect
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 13. FEDERAL DEFICITS, SURPLUSES, AND THE NATIONAL DEBT
13-1. The Federal Budget Balancing Act
13-1a. The Federal Budgetary Process
13-1b. Financing the National Debt
13-1c. The Rise and Fall of Federal Budget Surpluses and Deficits
13-1d. Debt Ceiling
13-2. Budget Surpluses and Deficits in Other Countries
13-3. Why Worry Over the National Debt?
13-3a. Can Uncle Sam Go Bankrupt?
13-3b. Are We Passing the Debt Burden to Our Children?
13-3c. Does Government Borrowing Crowd Out Private-Sector Spending?
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
ROAD MAP FOR CHAPTERS 8, 9, 10, 11, 12, AND 13
CHAPTER 14. MONEY AND THE FEDERAL RESERVE SYSTEM
14-1. What Makes Money?
14-1a. The Three Functions of Money
14-1b. Are Credit Cards Money?
14-1c. Desirable Properties of Money
14-1d. Are Bitcoins Money?
14-1e. What Stands Behind Our Money?
14-2. Money Supply Definitions
14-2a. M1: The Most Narrowly Defined Money Supply
14-2b. M2: Adding Near Monies to M1
14-3. The Federal Reserve System
14-3a. The Fed’s Organizational Chart
14-4. What a Federal Reserve Bank Does
14-4a. Controlling the Money Supply
14-4b. Clearing Checks
14-4c. Supervising and Regulating Banks
14-4d. Maintaining and Circulating Currency
14-4e. Protecting Consumers
14-4f. Maintaining Federal Government Checking Accounts and Gold
14-4g. Lender of Last Resort
14-5. The U.S. Banking Revolution
14-5a. The Monetary Control Act of 1980
14-5b. The Savings and Loan Crisis
14-5c. The Dodd-Frank Act of 2010
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 15. MONEY CREATION
15-1. Money Creation Begins
15-1a. Banker Bookkeeping
15-1b. Step One: Accepting a New Deposit
15-1c. Step Two: Making a Loan
15-1d. Step Three: Clearing the Loan Check
15-2. Multiplier Expansion of Money by the Banking System
15-2a. The Money Multiplier
15-2b. The Real-World Money Multiplier
15-3. How Monetary Policy Creates Money
15-3a. Open Market Operations
15-3b. The Discount Rate
15-3c. The Required Reserve Ratio
15-4. Monetary Policy Shortcomings
15-4a. Money Multiplier Inaccuracy
15-4b. Which Money Definition Should the Fed Control?
15-4c. Lags in Monetary Policy versus Fiscal Policy
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 16. MONETARY POLICY
16-1. How Are Interest Rates Determined?
16-1a. The Demand for Money
16-1b. The Equilibrium Interest Rate
16-1c. How Monetary Policy Affects the Interest Rate
16-1d. How Monetary Policy Affects Prices, Output, and Employment
16-2. The Monetarist View of the Role of Money
16-2a. The Monetarist Transmission Mechanism
16-3. A Comparison of Macroeconomic Views
16-3a. Classical Economics
16-3b. Keynesian Economics
16-3c. Monetarism
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
Appendix to Chapter 16. Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model
CHAPTER 17. THE PHILLIPS CURVE AND EXPECTATIONS THEORY
17-1. The Phillips Curve
17-1a. The Phillips Curve in Theory
17-1b. The Phillips Curve in Practice
17-2. The Long-Run Phillips Curve
17-2a. Natural Rate Hypothesis
17-2b. Adaptive Expectations Theory
17-2c. The Long-Run Phillips Curve and the Labor Market
17-3. The Theory of Rational Expectations
17-4. Applying the AD-AS Model to the Great Expectations Debate
17-5. Incomes Policy
17-5a. Presidential Jawboning
17-5b. Wage and Price Guidelines
17-5c. Wage and Price Controls
17-6. How Different Macroeconomic Theories Attack Inflation
Key Terms
Summary
. Take Note Revisited
Study Questions and Problems
Sample Quiz
ROAD MAP FOR CHAPTERS 14, 15, 16, AND 17
CHAPTER 18. INTERNATIONAL TRADE AND FINANCE
18-1. Why Nations Need Trade
18-1a. The Production Possibilities Curve Revisited
18-1b. Specialization without Trade
18-1c. Specialization with Trade
18-2. Absolute and Comparative Advantage
18-2a. Absolute Advantage
18-2b. Comparative Advantage
18-3. Free Trade Versus Protectionism
18-3a. Embargo
18-3b. Tariff
18-3c. Quota
18-4. Arguments for Protection
18-4a. Infant Industry Argument
18-4b. National Security Argument
18-4c. Employment Argument
18-4d. Cheap Foreign Labor Argument
18-4e. Free-Trade Agreements
18-5. The Balance of Payments
18-5a. Current Account
18-5b. Capital Account
18-5c. The International Debt of the United States
18-6. Exchange Rates
18-6a. Supply and Demand for Foreign Exchange
18-6b. Shifts in Supply and Demand for Foreign Exchange
18-6c. The Impact of Exchange Rate Fluctuations
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 19. ECONOMIES IN TRANSITION
19-1. Basic Types of Economic Systems
19-1a. The Traditional Economy
19-1b. The Traditional Economy’s Strengths and Weaknesses
19-1c. The Command Economy
19-1d. The Command Economy’s Strengths and Weaknesses
19-1e. The Market Economy and the Ideas of Adam Smith
19-1f. The Market Economy’s Strengths and Weaknesses
19-1g. The Mixed Economy
19-2. The “ISMS”
19-2a. Capitalism
19-2b. Capitalism’s Strengths and Weaknesses
19-2c. Socialism
19-2d. The Ideas of Karl Marx
19-2e. Characteristics of Socialism
19-2f. Socialism’s Strengths and Weaknesses
19-2g. Comparing Economic Systems
19-3. Economies in Transition
19-3a. Cuba
19-3b. Russia
19-3c. The People’s Republic of China
19-3d. Privatization versus Nationalization
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
CHAPTER 20. GROWTH AND THE LESS-DEVELOPED COUNTRIES
20-1. Comparing Developed and Less-Developed Countries
20-1a. Classifying Countries by GDP per Capita
20-1b. Problems with GDP per Capita Comparisons
20-1c. Quality-of-Life Measures of Development
20-2. Economic Growth and Development Around the World
20-2a. Endowment of Natural Resources
20-2b. Investment in Human Resources
20-2c. Accumulation of Capital
20-2d. Technological Progress
20-2e. Political Environment
20-3. The Helping Hand of Advanced Countries
20-3a. Foreign Private Investment
20-3b. Foreign Aid
20-3c. Foreign Loans
Key Terms
Summary
Take Note Revisited
Study Questions and Problems
Sample Quiz
ROAD MAP FOR CHAPTERS 18, 19 AND 20
