Question

1) What is real GDP?

Group of answer choices

It is the total market value of final goods and services produced in an economy in a given year.

It is a sustained increase in the average price level of goods and services.

It is the total market value of all final goods and services produced in an economy in a given year, adjusted for inflation.

It is an increase in the money supply.

2) The unemployment rate is:

Group of answer choices

the number of people receiving unemployment benefits as a percent of the total labor force.

the number of unemployed as a percent of the total labor force.

the number of unemployed as a percent of the total population.

the number of people receiving unemployment benefits as a percent of the total population.

100 percent minus the percent of the population who are employed.

3) Which of the following is not a monetary policy tool used by the Federal Reserve?

Group of answer choices

Open market operations

Prime rate

Discount rate

Reserve requirements

4) The interest rate Reserve Banks charge commercial banks for short-term loans is the

Group of answer choices

Prime rate

Discount rate

Subprime rate

Federal funds rate

5) Which monetary policy tool is the Federal Reserve using when it buys and sells government securities?

Group of answer choices

Open market operations

The discount rate

Reserve requirements

Interest on reserves

6) The traditional view on the federal funds rate is that by managing this interest rate, the Federal Reserve might be able to influence:

Group of answer choices

longer term interest rates.

mortgage rates.

the stock market.

consumer buying habits.

7) The federal funds rate is the interest rate:

Group of answer choices

on overnight loans.

for loans that are over six months.

on loans through the discount window.

for 30 year mortgages.

8) During the Free Banking Era,

Group of answer choices

Congress had complete control of the financial industry.

it was up to the states to determine what happened in the financial industry.

a lot of states issued their own currency.

Both B & C are correct.

Answer 1

1. Option C.

• Real GDP is the total value of the final goods and services produced within a given year in an economy
• It is the value of GDP adjusted for inflationary changes and is usually expressed in the base year prices.
• It can also be defined as the Nominal GDP adjusted for inflation.