Full name: Nguyễn Gia Khiêm – 11182432

Class: Tiếng anh 3 – Cấp độ 1 (320)_03

Mid – term Test 1

Question 1 : What have you studied from the 5 topics? (List and summarize each
unit)

Unit 1 : THE ECONOMIC PROBLEM

All societies face the economic problem, which is the problem of how to make the
best use of limited, or scarce, resources. The economic problem exists because, although
the needs and wants of people are endless, the resources available to satisfy needs and
wants are limited.

 Limited resources:
- Limited in physical quantity, as in the case of land, which has a finite quantity

- Limited in use, as in the case of labour and machinery, which can only be used for one
purpose at any one time.

 Choice and opportunity cost:

Choice and opportunity cost are two fundamental concepts in economics. Given that
resources are limited, producers and consumers have to make choices between competing
alternatives.

 Shortage conditions exist when:

- The demand is greater than supply;

- Either an increase in demand, decrease in supply, or government intervention.

-> This condition will be resolved and the market back in equilibrium.

Difference between shortage and scarcity : The easiest way to distinguish between the
two is that scarcity is a naturally occurring limitation on the resource that cannot be
replenished. A shortage is a market condition of a particular good at a particular price.
Over time, the good will be replenished and the shortage condition resolve

Unit 2 : GDP

 GDP:
Gross domestic product (GDP) is the total monetary or market value of all the finished
goods and services produced within a country’s borders in a specific time period. As a
broad measure of overall domestic production, it functions as a comprehensive scorecard
of a given country’s economic health. Note: - Gross domestic product (GDP) is the
monetary value of all finished goods and services made within a country during a specific
period.

- GDP provides an economic snapshot of a country, used to estimate the size of an

economy and growth rate.

- GDP can be calculated in three ways, using expenditures, production, or incomes. It

can be adjusted for inflation and population to provide deeper insights.

- Though it has limitations, GDP is a key tool to guide policy-makers, investors, and
businesses in strategic decision-making

 Nominal GDP
Nominal GDP is an assessment of economic production in an economy that includes
current prices in its calculation. In other words, it doesn’t strip out inflation or the pace of
rising prices, which can inflate the growth figure

 Real GDP
Real GDP is an inflation-adjusted measure that reflects the quantity of goods and services
produced by an economy in a given year, with prices held constant from year to year to
separate out the impact of inflation or deflation from the trend in output over time. Since
GDP is based on the monetary value of goods and services, it is subject to inflation.

 GDP Per Capita

GDP per capita is a measurement of the GDP per person in a country’s population. It
indicates that the amount of output or income per person in an economy can indicate
average productivity or average living standards.

 GDP Growth Rate

The GDP growth rate compares the year-over-year (or quarterly) change in a country’s
economic output to measure how fast an economy is growing.

Unit 3: The Business Cycle

 The business cycle

The business cycle is one of the central issues in macroeconomic theory and provides the
starting point for understanding the complex relationships between the various measures
of macroeconomic performance and the role of government economic policy.

 The 4 phases of business cycle

-1st phases is expansion Expansion is a period of economic growth. Growth is
characterized as higher household income, lower unemployment, and higher profits for
businesses. When household income higher, consumers will purchase more goods. By
selling more goods, businesses will start to see more profit. This is the upward trend for
the economy and businesses.

-2nd phases is the peak This is the height of the expansion. It's like being on a Ferris
wheel. The ride to the top is the expansion, and when you reach the highest point, you're
at the peak.

-3rd phases is contraction Once you’ve reached the peak, you start to come back down.
This is the contraction, and it’s the period of economic decline. You will see more
unemployment, and fewer products being purchased and produced. If the phase lasts for
six months or more -> a recession. If the recession is very long and very severe -> a
depression

-4th pheses is a trough If you’re back on the ferris wheel, you’ve reached the peak and
have started back down toward the bottom Once you've reached the bottom or the lowest
point, you'd be at the trough

 Factor affect the business cycle

The investment by businesses

The more money that individuals invest, the more money that companies have to spend to
grow their businesses. If a company expands -> more jobs, higher pay for employees, etc.
-> The unemployment rate, household income, etc…

The current interest rates If the interest rates are high, individuals will borrow less
because it costs more, if a business is borrowing less, they ‘ll not be expanding as much.
If individuals borrow less, they’ll also be buying less.

The optimism If individuals are optimistic about the future about the future and the
economy, they’ll spend more. If they spend more, then businesses will produce more and
expand
The outside sources If there is a large natural disaster, then the economy could have a
contraction. If there is a positive source, then the economy could see an expansion.

Unit 4: Demand and supply

 Demand for Goods and Services

Demand is the amount of some goods or services consumers are willing and able to
purchase. Demand is based on ability to pay. If you cannot pay for it, you have no
effective demand. Demand is defined as the amount of some good or service consumers
are willing and able to purchase

Quantity Demanded is The total number of units purchased at the price is called the
quantity demanded.

Law of Demand

A rise in price → decreases the quantity demanded

A fall in price → increases the quantity demanded

 Supply of Goods and Services

Supply is the amount of some good or service which a producer is willing to supply to
everyone at each price

Law of Supply : The law of demand state that, if all other variables that affect demand are
held constant, a rise in price of a good or service almost always decreases the quantity
demanded of that good or service, and a fall in price will increase the quantity demanded.

A rise in price → increases the quantity supplied

A fall in price → decreases the quantity supplied

Curve is a upward slope : Each point on the curve reflects a direct correlation between
quantity supplied and price. The lower the price of a good, the lower the quantity
supplied will be, and the higher the price, the more the good will is in supply.

Demand and quantity demand : Demand refers to the curve. Quantity demanded refers to
the certain point on the curve The quantity demanded is the amount of a good or service
people are willing to buy at a certain price.

Supply and quantity supplied: Supply refers to the curve. Quantity supplied refers to the
certain point on the curve. Supply is defined as the amount of some good or service a
producer is willing to supply. The quantity supplied refers to the amount of a certain good
or service producers are willing to supply when receiving a certain price.

 Equilibrium – Where Demand and Supply Intersect

Demand and supply determine the price and the quantity that will be bought and sold in
the market

The equilibrium price is the only price where the quantity demanded is equal to the
quantity supplied. This quantity is called the equilibrium quantity

At any other price, the quantity demanded does not equal the quantity supplied, so the
market is not in equilibrium at that price.

The price is below the equilibrium level → The quantity demanded will exceed the
quantity supplied → Excess demand or a shortage will exist

The price is above the equilibrium level → The quantity supplied exceeds the quantity
demanded → Excess supply or a surplus will exist

➔ Economic pressures will push the price toward the equilibrium level

Unit 5: Monetary policy & Fiscal policy

 Monetary Policy
Definition : Monetary policy is the economic policy laid down by the central bank. This
policy determines the size and rate of growth of the money supply, which in turn affects
interest rates.

Monetary policy is maintained through actions such as modifying the interest rate, buying
or selling government bonds, and changing the amount of money banks are required to
keep in the vault (bank reserves).

Types of monetary policies

Expansionary monetary policy increases the money supply in order to lower

unemployment, boost private – sector borrowing and consumer spending, and stimulate
economic growth.

Contractionary monetary policy slows the rate of growth in the money supply or outright
decreases the money supply in order to control inflation; while sometimes necessary,
contractionary monetary policy can slow economic growth, increase unemployment and
depress brrowing and spending by consumers and businesses.
Monetary Policy Tools

Open market operations are when the central banks buys or sells securities. These are
bought from or sold to the country’s member banks. The central bank buys securities
when it wants expansionary monetary policy. It sells them when it executes
contractionary monetary policy.

Reserve requirement refers to the money banks must keep on hand overnight. They can
either keep the reserve in their vaults or at the central bank.

Discount rate is the rate that central banks charge its members to borrow at its discount
window. Since the rate is high, banks only use this if they can’t borrow funds from other
banks.

Discount rate is the rate that central banks charge its members to borrow at its discount
window. Since the rate is high, banks only use this if they can’t borrow funds from other
banks.

 Fiscal Policy
Definition

Fiscal policy can be defined as the government’s policy to influence an economy through
the use of taxation and government spending. This type of policy is used when policy
makers believe the economy needs outside help in order to adjust to a desire point.
Typically a government has a desire to maintain steady prices. An employment level, and
a growing economy. If any of these areas are out of sorts, type of fiscal policy may be in
order.

Fiscal policy can be used in order to either stimulate a sluggish economy or to slow down
an ecomony that is growing at a rate getting out of control. Fiscal policy directly affects
the affregate demand of an economy.

Types of fiscal policies

When an economy is in a recession, expansionary fiscal policy is in order. Typically this

type of fiscal policy results in increased government spending and/or lower taxes, which
would help an economy grow.

Contractionary fiscal policy is essentially the opposite of expansionary fiscal policy.

When an economy is in a state where growth is at a rate getting out of control (causing
inflation and asset bubbles), contractionary fiscal policy can be used to reduce
government spending and/or increase taxes. This would bring the economy to a more
sustainable level.

Fiscal Policy Tools

Taxation includes income, capital gains from investments property, and sales provide the
income that funds the government.

Taxation includes income, capital gains from investments property, and sales provide the
income that funds the government.

QUESTION 2 : What do you think about the contents and the teaching
methods in the course? ( no more than 10 sentences)
I think the content and teaching methods extremely reasonable in the context of online
learning. The teacher's knowledge is very complete and she teaches very easily. Each
lesson has in-hours and after-school exercises to help students master the knowledge
better. The students who answer correctly and fastest will be awarded points to help
motivate everyone to learn more. Although I did not attend the full number of classes, I
was still able to grasp the basic knowledge of the curriculum and gain a better
understanding of economics. However, I wish teachers could provide a little more of the
break and teach a bit more slowly.

Please allow me to rate 5* for this.

Question 3 : List the words / phrases from the 5 units that you are
interested in (as many as possible)
Unit 1: Choice, shortage, Resources, opportunity cost, scarcity

Unit 2: GDP, Nominal GDP, Real GDP, GDP Per Capita, GDP Growth Rate, Total
market value, "Final goods and services, Produced within an economy

Unit 3 : The business cycle, Expansion , the peak, contraction, a trough, recession,
depression, The investment by businesses, The current interest rates , The optimism, The
outside sources

Unit 4: Demand, Quantity Demanded , Law of Demand, Supply, Quantity Supply

,Equilibrium,Economic pressures will push the price toward the equilibrium level

Unit 5: Expansionary, Contractionary, Fiscal Policy, Taxation, Government Spending,

Monetary Policy