Ole Miss-Econ 203 Mcginness
Exam 1 Study Guide with
correct questions and answers
usr
[COMPANY NAME] [Company address]
, 1. What is macroeconomics? Answer: The study of aggregate behavior, including
unemployment, inflation, reces- sions, and other economy wide phenomenon
2. What is the difference between microeconomics and macroeconics?
Answer: Micro is small scale while macro is big picture.
3. What are the three main concerns of Macroeconomics? Answer: inflation,
unemployment, output growth
4. What event triggered the new need for new theory in
Macroeconomics? Answer: The Great Depression
5. Who is the father of Macroeconomics? Answer: John Maynard Keynes
6. What was the pre-existing theory called? Answer: neoclassical theory
7. With the classical model of economics, what is the cause of
unemployment and how is it alleviated? Answer: A market price above the intersection
of demand and supply. The wage should fall until unemployment falls to a normal level.
8. What is the cause of short-run fluctuations in the country,
according to the Keynesian theory? Answer: "sticky" prices
9. What are recessions and booms? Answer: recessions are significant declines in
economic activity across the country while booms are periods of increased commercial activity
10. What is aggregate output? Answer: the total level of new production of goods and
services from an economy
11. What is Output Growth? Answer: (refers to increases in Aggregate Output from the
previous period) percent- age change in Aggregate Output from the previous period
12. What is GDP? Answer: the total value of all new goods and services produced within a
country's borders in a given time period
13. What is GNP? Answer: the total production of new goods and services by a country's
citizens within a given time period
14. Who measures GDP? Answer: Bureau of Economic Analysis (BEA)
15. What does GDP include and what does GDP not include? Answer:
GDP does not include Answer: crime, pollution, income distribution, or income from
citizen's living abroad
GDP does include Answer: the value of all the new goods and services produced within a country's borders
in a given period
16. What is double counting of GDP and how is it prevented? Answer:
2/
6
Exam 1 Study Guide with
correct questions and answers
usr
[COMPANY NAME] [Company address]
, 1. What is macroeconomics? Answer: The study of aggregate behavior, including
unemployment, inflation, reces- sions, and other economy wide phenomenon
2. What is the difference between microeconomics and macroeconics?
Answer: Micro is small scale while macro is big picture.
3. What are the three main concerns of Macroeconomics? Answer: inflation,
unemployment, output growth
4. What event triggered the new need for new theory in
Macroeconomics? Answer: The Great Depression
5. Who is the father of Macroeconomics? Answer: John Maynard Keynes
6. What was the pre-existing theory called? Answer: neoclassical theory
7. With the classical model of economics, what is the cause of
unemployment and how is it alleviated? Answer: A market price above the intersection
of demand and supply. The wage should fall until unemployment falls to a normal level.
8. What is the cause of short-run fluctuations in the country,
according to the Keynesian theory? Answer: "sticky" prices
9. What are recessions and booms? Answer: recessions are significant declines in
economic activity across the country while booms are periods of increased commercial activity
10. What is aggregate output? Answer: the total level of new production of goods and
services from an economy
11. What is Output Growth? Answer: (refers to increases in Aggregate Output from the
previous period) percent- age change in Aggregate Output from the previous period
12. What is GDP? Answer: the total value of all new goods and services produced within a
country's borders in a given time period
13. What is GNP? Answer: the total production of new goods and services by a country's
citizens within a given time period
14. Who measures GDP? Answer: Bureau of Economic Analysis (BEA)
15. What does GDP include and what does GDP not include? Answer:
GDP does not include Answer: crime, pollution, income distribution, or income from
citizen's living abroad
GDP does include Answer: the value of all the new goods and services produced within a country's borders
in a given period
16. What is double counting of GDP and how is it prevented? Answer:
2/
6
