THE FEDERAL RESERVE
Three Shifters of Money Supply
Reserve Requirements (Ratios) Lending money to banks and thrifts (Discount rate)
Open market operations (buying and selling bonds/securities) the FED is chaired by
Unit 4 Notes
1. (p. 343) Compulsory arbitration may occur when an outside party such as the federal government requests it to stop a prolonged strike that threatens to disrupt the economy. TRUE
AACSB: Reflective ThinkingBloom's Taxonomy: KnowledgeDifficulty: MediumLea
1. (p. 341-343) Discuss tactics labor and management may use to gain their objectives.
One of the more effective weapons against management is the strike. In addition, picketing
can alert the public about the union's concerns regarding a c
1. (p. 336) To motivate employees such as car salespersons to sell as much as they can, they are
paid A. commissions.B. time wages.C. piece wages.D. by units.E. the minimum.
AACSB: Reflective ThinkingBloom's Taxonomy: KnowledgeDifficulty: EasyLearning Obj
1. (p. 333) Downsizing is most likely the result of A. violations of company rules.B. excessive
absenteeism.C. frequent tardiness.D. efforts to increase productivity and competitiveness.
E. excellent work.
AACSB: Reflective ThinkingBloom's Taxonomy: Knowl
1. (p. 330-331) What is a performance appraisal?
A performance appraisal identifies an employee's strengths and weaknesses on the job. It is
one of the more difficult tasks of managers, yet it is very important.
AACSB: Reflective ThinkingB
Debit is funds leaving the domestic country Credit is funds entering
the domestic country
Foreign Exchange (aka FOREX)
The exchange rates are always changing
Exchange Rates In the FOREX market we only look at two countries/currencies at a
ex: US do
Unit 2 Notes: International Trade
Everyone specializes in the production of goods and services and trade it to others. Per
Unit Opportunity Cost
Ex: It costs you $50 to produce 5 t-shirts. what is you PER UNIT cost or each shirt?
($10 per shirt)
Bonds vs. Stocks
Bonds are loans or IOUs that represent debt that the government or a corporation must
repay to an investor.
The bond holder has NO OWNERSHIP of the company Stockowners can earn a profit
Dividends, which are portions of corporat
Unit 1 Notes
Why do we use money?
The Barter System: goods and services are traded directly. There is no money exchange Problems: Before trade could occur, each trader had to have something the other wanted Some goods cannot be split (1 goat for 5 chicke