Economic Challenges and Responses in the United States Quiz

CPI measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Keynesian economics advocates for government intervention to manage economic cycles and stabilize fluctuations.

Asymmetric information occurs when one party has more knowledge, leading to potential market inefficiencies.

A tariff is a tax imposed on imports or exports, affecting the cost and competitiveness of foreign and domestic goods.

The IMF provides financial aid and policy advice to countries facing balance of payments crises to stabilize their economies.

The Federal Reserve controls the money supply and implements monetary policies to achieve economic stability and growth.

The Phillips Curve depicts an inverse relationship between inflation and unemployment.

The WTO aims to promote global trade by reducing barriers and negotiating trade agreements among member countries.

Crowding out occurs when increased government borrowing leads to reduced private sector investment.

Stagflation is a situation of stagnant economic growth, high inflation, and high unemployment simultaneously.

GDP measures the economic output of a country, representing the total value of goods and services.

The Triffin Dilemma refers to challenges in maintaining a global reserve currency, often associated with the role of the U.S. dollar.

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price.

The Laffer Curve shows the potential effects of tax rates on government revenue, highlighting an optimal tax rate.

Antitrust laws aim to promote competition, prevent monopolies, and ensure fair business practices.