of 41 /41

Macroeconomics 09

  • Upload

  • View

  • Download

Embed Size (px)

Text of Macroeconomics 09

Page 1: Macroeconomics 09


Page 2: Macroeconomics 09

Microeconomics or Macroeconomics ?

1.__________________is the part of economic theory that deals with the economy as a whole and decision making by large units such as government and unions.

Page 3: Macroeconomics 09


2.One way in which the federal government impacts the economy is by the sheer size of the budget. Which figure below is the approximate budget?

1 trillion 2 trillion 3 trillion 10 trillion

Page 4: Macroeconomics 09


3.Another way the federal government impacts the economy is through controlling the nation’s money supply. They do this through

A. The Bank of the U.S.-The BUS B. The Federal Reserve-The FED C. The Dept. of Commerce-The DOC

Page 5: Macroeconomics 09


4. __________is the Chairman of the Federal Reserve.

A. Alan Greenspan B. Ben Bernanke C. Tony Hawk D. Gale Norton

Page 6: Macroeconomics 09


4A. Hello children-I am _______. I and the Board of Governor’s try to control the nation’s monetary supply. We set fiscal policy. I can destroy you.

Page 7: Macroeconomics 09

I was appointed by the president

And confirmed by the upper house.

5. What is the upper house of Congress?

Page 8: Macroeconomics 09


Page 9: Macroeconomics 09

The Fed wants to try and keep the economy on an even keel.

It wants to keep a balance between two extremes. Can you think what these extremes are?

Page 10: Macroeconomics 09

(Hint-One extreme is too many dollars chasing too few goods. Everybody has jobs, everybody is spending money and suppliers cannot keep up with demand) Prices are rising.

6. What is this problem called? A. Inflation B. Recession C. Depression

Page 11: Macroeconomics 09


Inflation is characterized by rising prices and an economy that erodes purchasing power. The rich are badly hurt as well as those on fixed incomes.

Page 12: Macroeconomics 09

7. The other extreme is too few dollars chasing too many goods. People have lost their jobs, they are afraid to buy anything except the bare necessities.

What is it known as? A. inflation B. recession C. expansion

Page 13: Macroeconomics 09


Page 14: Macroeconomics 09

In effect the Fed tries to keep a balance in the economy:

If the economy is showing signs of inflation, then the fed tries to slow the economy down by making money:

8. Cheaper or

more expensive?

Page 15: Macroeconomics 09

Ans- 8

Page 16: Macroeconomics 09

9.How do you make money more expensive ?A. You charge more to borrow itB. You change the interest rateC. Tighten the money supplyD. All of the above

Page 17: Macroeconomics 09


You charge more to borrow it You change the interest rate You make money more expensive

Page 18: Macroeconomics 09

10.Do you raise or lower the interest rate?

Page 19: Macroeconomics 09

10.Dude you so ______ it.

The Fed makes money harder to borrow by raising the interest


Page 20: Macroeconomics 09

Suppose there was a recession:

11. What would Chairman Bernanke do to make money more available, to make it cheaper to restore people’s faith in the future?

Would he raise or lower the interest rate?

Page 21: Macroeconomics 09


That would make it easier to borrow so that businesses could expand or people will buy a house or a car or take a vacation.

Page 22: Macroeconomics 09

Economic Indicators

Just like a doctor checks your pulse, temperature and blood pressure, the Fed checks economic indicators. These indicators can tell The Fed whether the economy is in danger of getting too hot or too cold.

Page 23: Macroeconomics 09

12. Can you name an indicator when the economy is getting too cold?

A. Booming house sales

B. Car sales through the roof

C. Washers and dryers selling like hotcakes

D. High unemployment rate

Page 24: Macroeconomics 09


13. Once you get above a 6% unemployment rate,then The

Fed would have to be concerned about a possible__________.

Page 25: Macroeconomics 09


Page 26: Macroeconomics 09

14. Another indicator

Page 27: Macroeconomics 09

Answer14. (hint:picture)

Page 28: Macroeconomics 09

15. Another ?

Page 29: Macroeconomics 09

15.____or the sale of durable goods like refrigerators

or Washers and dryers or ranges

Page 30: Macroeconomics 09

The price of an essential commodity

Page 31: Macroeconomics 09

16. Another indicator is the growth of all the below except:

A.Gross domestic product

B.Trade imbalance


D.PSSA and SAT scores

E.The value of the dollar in relation to other currencies

Page 32: Macroeconomics 09


Page 33: Macroeconomics 09

The Fed cannot outlaw the

17. business cycle but it tries to moderate the extremes between recession and __________.

A. depression B. recovery C. incidence of string cheese D. expansion

Page 34: Macroeconomics 09

Answer 17

Page 35: Macroeconomics 09

As the nation’s chief economist Ben Bernanke is very concerned abouta lot of issues.

Page 36: Macroeconomics 09

18. For instance, he is worried about the fact that every year the US federal government is spending more than it has. This is called the _____________ A. the national debt B. the trade gap C. the deficit

Page 37: Macroeconomics 09


19. He is also very concerned about our accumulated deficits now over 9 trillion.

This is the A. national debt B. trade gap C. the deficit

Page 38: Macroeconomics 09

19. answer

Page 39: Macroeconomics 09

And the trade deficit is also a concern.

Page 40: Macroeconomics 09

20. Particularly our dependence on foreign________?

Page 41: Macroeconomics 09

20. Picture?