100 words per question
- Why would removing a trade restriction, such as a tariff, lead to more rapid economic growth?
- What is the role of the financial system? Name and describe two markets that are part of the financial system in the U.S. economy. Name and describe two financial intermediaries.
- What is a government budget deficit? How does it affect interest rates, investment, and economic growth?
- Comparing stocks and government bonds, which type of asset has more risk? Which pays a higher average return?
- What is diversification? Does a stockholder get a greater benefit from diversification going from 1 to 10 stocks or going from 100 to 120 stocks?
- What are the three categories into which the Bureau of Labor Statistics divides everyone? How does the BLS compute the labor force, the unemployment rate, and the labor-force participation rate?
- Why is frictional unemployment inevitable? How might the government reduce the amount of frictional unemployment?
