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Exam (elaborations)

Econ 202 Test 2 Questions With Correct Answers

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ECON 202 TEST 2 QUESTIONS WITH CORRECT ANSWERS

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Non-investment grade bonds are bonds that receive an S&P bond rating of _______ and
lower.


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BB




As a result of the 2007 financial crisis, when financial institutions began faltering:


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financial intermediaries all over the world became less inclined to extend
loans

,Krista owns a hair salon. She wants to increase the number of clients she serves each
month, so she knows she needs to acquire more resources. Which of the following
actions would represent an increase in the human capital resource at her hair salon?


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hiring more stylists




The risk that the borrower will not pay the face value of a bond on the maturity date is
called the:


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DEFAULT RISK




When a change in the price level leads to a change in the quantity of net exports
demanded, it is called the:


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international trade effect




Increases in productivity will:


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, increase LRAS




Using the table, what is the total federal income tax bill for someone who makes
$67,000 per year?


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12,780




If the economy starting at full-employment output begins to enter into an expansion,
one would expect Congress and the president to conduct:


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contractionary fiscal policy




If consumers decide to save a larger percentage of their income, it will be:


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beneficial in the long run because interest rates will fall




According to the textbook, which of the following countries is not considered a
"wealthy nation"?

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Liberia




A tradable contract that entitles its owner to certain rights is called:


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a security




The second of two significant fiscal policy initiatives enacted by the government
during the Great Recession, signed in February 2009 by President Barack Obama, was
the


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American Recovery and Reinvestment Act of 2009




During economic expansions:


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outlays decrease and tax revenues increases




The term ___________ is a popular way to describe the recession-expansion pattern
followed by the economy.

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