Business 101 Chapter 2 Quiz – Flashcards
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After the collapse of the dot com bubble and the 9/11 terrorist attacks, the stock market depreciated and unemployment increased leading many to fear that the country was on the brink of a full-blown recession. In order to stimulate the economy the Federal Reserve Bank
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lowered interest rates from 6.5% to 1.25% in an effort to increase spending.
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What is the economics.
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the study of the choices that different entities make in allocating resources
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_____ refers to government efforts to influence the economy through taxation and spending decisions designed to encourage growth, boost employment, and curb inflation.
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Fiscal policy
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In the U.S., the control of the money supply is the responsibility of the
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Federal Reserve.
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If the Fed wants to increase the money supply it should:
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buy government securities
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In _____, many firms compete by selling differentiated products.
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monopolistic competition
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