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Unformatted text preview: STUDY GU I DE FOR EC141 F I NAL EXAM ************************************************* Students - Go through this list of economic concepts and topics that you should know by the end of this course. Look up in your textbook and study any that you are unsure of before you take the final exam! SAMPLE OF SHORT ANSWER QUESTIONS SIM I LAR TO T HESE (no multiple choice questions) : 1. Which four types of spending are represented by the AD curve? ( Page 108 ) ( Think in terms of GDP = C + I + G + NX ) (Consumption, Investment, Government spending (consumption) and next export (EX-I M) 2. Define “the aggregate supply curve.” (Think in terms of the total quantity of goods and services) ( Page 238 ) A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. 3. Define “cause of inflation” ( Pages 246-249 ) Basically when the government increases the money supply faster than the quantity of goods increases we have inflation. Interestingly as the supply of goods increase the money supply has to increase or else prices actually go down. 4. Explain differences between two types of inflation, “cost-push inflation” and “demand-pull inflation.” ( Pages 246-247 ) Cost-push inflation – Inflation caused by an increase in costs. Demand-pull inflation – Inflation that is initiated by an increase in aggregate demand. 5. Define “easy monetary policy”. ( Page 213 ) Fed policies that expand the money supply and thus lower interest rates in an effort to stimulate the economy. SAMPLE OF GRAPH ICAL PROBLEMS TYPE QUEST IONS 6. Supply and Demand Analysis. a) Illustrate the market for a good by drawing the industry’s demand and supply curves. On the graph, identify the equilibrium price and the equilibrium quantity. Be sure to label all axes and curves....
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This note was uploaded on 06/15/2010 for the course EC 141DLC taught by Professor Antonifirner during the Fall '09 term at Park.
- Fall '09