Unit Review Quiz

All of these are part of the business cycle EXCEPT

• Peak

• Inflation

• Expansion

• Trough

Label the different parts of the business cycle

a

b

c

d

Expansion

Peak

Trough

Contraction

Which phase of the business cycle is characterized by a rapid increase in economic activity?

Fiscal policy is the federal government’s use of taxing and spending to keep the economy stable

• True

• False

Classical Economics ran into what issue with the business cycle?

• It failed to account for the influence of consumer confidence on the business cycle.

• It did not consider the impact of technological advancements on the business cycle.

• It did not take into account Government intervention

• It did not address how deep the troughs are or how long the troughs last.

If the Fed is concerned about inflation, they would implement a (a)   money policy.

• Tight

• Easy

What is the name of the type of tax that takes a larger percentage from high-income people?

All of these are tools used by The FED EXCEPT

• 1. Reserve Requirements

• Implementing fiscal policy

• 1. Open Market Operations

• 1. The Discount Rate

What is the primary cause of inflation in an economy?

• Decrease in production

• Decrease in demand

• Increase in money supply

• Decrease in money supply

The Minimum amount of reserves (CASH) that must be held by a commercial bank is known as?