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Economic Factors Flashcards

5 cards from real S-12 practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 5 Economic Factors flashcards as text

  1. What is the primary purpose of fiscal policy in the economy?

    Answer: To control government spending and taxation

    Fiscal policy, implemented by the government, adjusts spending levels and tax rates to influence economic activity.

  2. Which Federal Reserve tool directly affects the money supply?

    Answer: Open market operations

    The Federal Reserve buys or sells government securities to increase or decrease the money supply.

  3. What does Gross Domestic Product (GDP) measure?

    Answer: The total market value of goods and services produced in a country

    GDP indicates the overall economic health and size of an economy.

  4. During which phase of the business cycle is unemployment typically the highest?

    Answer: Trough

    Unemployment is highest during the trough phase, when economic activity is at its lowest point.

  5. How does inflation impact fixed-income investments?

    Answer: Reduces their purchasing power

    Inflation erodes the real value of fixed-income returns, as purchasing power declines over time.

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Sources & references

Exam facts on this page (fees, format, dates, passing scores) are checked against these official sources; the date is our last check. Editorial policy

  1. nyc-business.nyc.gov — Fees, retake policy, score validity · verified Oct 2026
  2. nyc.gov — Test delivery, exam format, passing score, registration deadline, renewal, score release, time limit · verified Oct 2026