Econ 104 Final – Goffe Questions with
Correct Answers Guaranteed 100% Pass
aggregate demand and supply model - Answer -a model that explains short-run fluctuations in real
GDP and the price level
Aggregate demand curve - Answer -a curve that shows the relationship between the price level
and the quantity of real GDP demanded by households, firms, and the government
Anticipated inflation - Answer -value of money declines and menu costs need to change
assets - Answer -something you own
Assets equation - Answer -liabilities + net worth
bonds - Answer -a security sold by large businesses or governments. Consumers buy these and the
seller is entitled to pay back the owner with interest at a given date.
Business Cycle - Answer -alternating periods of economic expansion and economic recession
Calculate the growth rate - Answer -(current year/first year)^(1/n) - 1
capital - Answer -manufactured goods that are used to produce other goods and services
Causes of recessions - Answer -1. Monetary policy
2. Oil Shock
3. Fiscal policy
4. Financial policy
Checking deposit Calculation - Answer -(1/RR)*reserves
Connection between health and economic growth - Answer -technological advances help to grow
the economy and because of these advances medicine has been updated keeping the population
healthier than before
Consumption - Answer -spending by households on goods and services, not including spending on
new houses
Core Inflation - Answer -ignores food/energy, as they can be more volatile
CPI - Answer -used to correct nominal prices and wages over time for the impact of inflation using
market basket prices
Current CPI value - Answer -237.8
, Current GDP deflator - Answer -110
Current Nominal GDP - Answer -$18 trillion
Current Real GDP - Answer -$16.4 trillion
Cyclical unemployment - Answer -unemployment cause by a business cycle recession
Debt - Answer -total amount of money owed
Deficit - Answer -amount of money borrowed per year
deflation - Answer -a decline in the price level
discouraged workers - Answer -people who are available for work but have not looked for a job
during the previous four weeks because they believe no jobs are available for them
Economic growth - Answer -the ability of an economy to produce increasing quantities of goods
and services
economic growth model - Answer -a model that explains growth rates in real GDP per capita over
the long run
Efficiency wage - Answer -an above market wage that a firm pays to increase workers' productivity
Expansion - Answer -the period of a business cycle during which total production and total
employment are increasing
factor market - Answer -a market for the factors of production, such as labor, capital, natural
resources, and entrepreneurial ability
Final good or service - Answer -a good or service purchased by a final user
Financial policy and recessions - Answer -
Fiscal Policy - Answer -Controlled by the president and congress. It is the government budget.
Fiscal policy and recessions - Answer -federal spending and taxes
free market - Answer -a market with few government restrictions on how a good or service can be
produced or sold or on how a factor of production can be employed
Frictional unemployment - Answer -short-term unemployment that arises from the process of
matching workers with jobs
Future economic growth in the U.S. - Answer -1. Slowing capital
2. Falling labor force participation
3. Rising inequality
4. Innovation slowdown
Correct Answers Guaranteed 100% Pass
aggregate demand and supply model - Answer -a model that explains short-run fluctuations in real
GDP and the price level
Aggregate demand curve - Answer -a curve that shows the relationship between the price level
and the quantity of real GDP demanded by households, firms, and the government
Anticipated inflation - Answer -value of money declines and menu costs need to change
assets - Answer -something you own
Assets equation - Answer -liabilities + net worth
bonds - Answer -a security sold by large businesses or governments. Consumers buy these and the
seller is entitled to pay back the owner with interest at a given date.
Business Cycle - Answer -alternating periods of economic expansion and economic recession
Calculate the growth rate - Answer -(current year/first year)^(1/n) - 1
capital - Answer -manufactured goods that are used to produce other goods and services
Causes of recessions - Answer -1. Monetary policy
2. Oil Shock
3. Fiscal policy
4. Financial policy
Checking deposit Calculation - Answer -(1/RR)*reserves
Connection between health and economic growth - Answer -technological advances help to grow
the economy and because of these advances medicine has been updated keeping the population
healthier than before
Consumption - Answer -spending by households on goods and services, not including spending on
new houses
Core Inflation - Answer -ignores food/energy, as they can be more volatile
CPI - Answer -used to correct nominal prices and wages over time for the impact of inflation using
market basket prices
Current CPI value - Answer -237.8
, Current GDP deflator - Answer -110
Current Nominal GDP - Answer -$18 trillion
Current Real GDP - Answer -$16.4 trillion
Cyclical unemployment - Answer -unemployment cause by a business cycle recession
Debt - Answer -total amount of money owed
Deficit - Answer -amount of money borrowed per year
deflation - Answer -a decline in the price level
discouraged workers - Answer -people who are available for work but have not looked for a job
during the previous four weeks because they believe no jobs are available for them
Economic growth - Answer -the ability of an economy to produce increasing quantities of goods
and services
economic growth model - Answer -a model that explains growth rates in real GDP per capita over
the long run
Efficiency wage - Answer -an above market wage that a firm pays to increase workers' productivity
Expansion - Answer -the period of a business cycle during which total production and total
employment are increasing
factor market - Answer -a market for the factors of production, such as labor, capital, natural
resources, and entrepreneurial ability
Final good or service - Answer -a good or service purchased by a final user
Financial policy and recessions - Answer -
Fiscal Policy - Answer -Controlled by the president and congress. It is the government budget.
Fiscal policy and recessions - Answer -federal spending and taxes
free market - Answer -a market with few government restrictions on how a good or service can be
produced or sold or on how a factor of production can be employed
Frictional unemployment - Answer -short-term unemployment that arises from the process of
matching workers with jobs
Future economic growth in the U.S. - Answer -1. Slowing capital
2. Falling labor force participation
3. Rising inequality
4. Innovation slowdown
