This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 109 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 109 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. How does the federal government borrow money? A) Asks members of parliament to fork over some of their salaries. B) Raises taxes. C) Sells treasury bonds. D) Asks people on welfare for food stamps. Show Answer Correct Answer: C) Sells treasury bonds. 2. Absolute advantage A) TRICE-Technology (can both increase or decrease the curve), Related Prices (substitutes/compliments), Input prices, Competition, Expectations. B) A property of an efficient market whereby all goods and services are optimally distributed among buyers in an economy. C) The ability to produce more of a given product using a given amount of resources. D) A model that shows the flow of goods and services and the interaction among households, businesses, and banks. Show Answer Correct Answer: C) The ability to produce more of a given product using a given amount of resources. 3. The goal of government welfare programs is to A) Maintain a poverty threshold that matches the median income. B) Eliminate the dependence of people on the welfare system. C) Eliminate the income gap between the richest Americans and the poorest. D) Raise the standard of living of certain less-fortunate members of society. Show Answer Correct Answer: D) Raise the standard of living of certain less-fortunate members of society. 4. According to the ....., an increase in expected future inflation drives up the nominal interest rate by the same number of percentage points, leaving the expected real interest rate unchanged. A) Fisher Effect. B) Farmer Effect. C) Business Effect. D) Tech Effect. Show Answer Correct Answer: A) Fisher Effect. 5. Identifying the least-cost method of producing textbooks A) Macroeconomics. B) Microeconomic. Show Answer Correct Answer: B) Microeconomic. 6. Fiscal expansionary policy (increase in govt purchases or decrease in taxes) under floating exchange rates A) Shifts IS* rightraises exchange rateno effect on income. B) Shifts IS* right raises exchange rateraises income. C) Shifts IS* leftraises exchange rateno effect on income. D) Shifts IS* leftraises exchange rateraises income. Show Answer Correct Answer: A) Shifts IS* rightraises exchange rateno effect on income. 7. The labor force consists of A) Everyone who has a job. B) All employed workers minus all unemployed workers. C) All employed workers minus all military workers. D) All employed and unemployed civilian workers. Show Answer Correct Answer: D) All employed and unemployed civilian workers. 8. What is the formula for GDP? A) C + I + G + (X-M). B) C + I + G / (X-M). C) C + I + G + (population). D) C + I + G + (M-X). Show Answer Correct Answer: A) C + I + G + (X-M). 9. Long-run economic growth is: A) Higher in countries when it has a weak rule of law and excessive government intervention. B) Lower in countries when it has a strong government and independent judiciary. C) Lower in countries when the courts enforce property rights and a government that protects its citizens. D) Higher in countries when it has a strong rule of law and political stability. E) Higher in countries when it has a strong rule of law and a corrupt judiciary. Show Answer Correct Answer: D) Higher in countries when it has a strong rule of law and political stability. 10. Which of the following is a step that the central bank will take to increase the overall availability of credit? A) Sell the securities in the market. B) Buy securities from the market. C) Raise the reverse repo rate. D) Raise the repo rate. Show Answer Correct Answer: B) Buy securities from the market. 11. A ..... is an increase in the value of a currency that is set under a fixed exchange rate regime. A) Revaluation. B) Devaluation. C) Valuation. D) None of above. Show Answer Correct Answer: A) Revaluation. 12. Which of the following is a component of Aggregate Demand? A) Unemployment. B) Government Spending. C) Inflation. D) Wage rates. Show Answer Correct Answer: B) Government Spending. 13. The most likely reason for a government to deliberately have a budget deficit is in order to A) Stimulate the level of AD. B) Boost the level of net exports. C) To redistribute income and wealth. D) Reduce the general level of prices. Show Answer Correct Answer: A) Stimulate the level of AD. 14. Which of the following is a benefit of implementing supply-side policies? A) Increases employment rate. B) Very costly production. C) People are resistant to change. D) Policies take a long time to implement. Show Answer Correct Answer: A) Increases employment rate. 15. The following data about a hypothetical economy are in billions of dollars.Personal Consumption Expenditures $ 4500Gross Private Domestic Investment 150Government Purchases 950Exports 65Imports 85Refer to the above data. GDP in this economy is: A) $ 6, 080 billion. B) $ 6, 230 billion. C) $ 6, 380 billion. D) $ 6, 400 billion. Show Answer Correct Answer: B) $ 6, 230 billion. 16. If I produce cereal but, the government has to check to make sure I can put this product on the market, what economic system is this? A) Market. B) Command. C) Mixed. D) Traditional. Show Answer Correct Answer: C) Mixed. 17. Unemployment is one of the macroeconomis goal. A) TRUE. B) FALSE. Show Answer Correct Answer: B) FALSE. 18. Which is the Fed MOST likely to do in the event of a recession? A) Raise the discount rate. B) Raise interest on reserves. C) Buy treasury bonds on the open market. D) Sell treasury bonds on the open market. Show Answer Correct Answer: C) Buy treasury bonds on the open market. 19. The depreciation value of plant and equipment during the production of goods and services is called: A) Consumption. B) Depreciation. C) Invest. D) Intermediate goods. Show Answer Correct Answer: B) Depreciation. 20. Which of the following will cause the short-run aggregate supply curve to shift to the left? A) An increase in the price level. B) A decrease in the price level. C) An increase in trade deficits. D) An increase in nominal wages. E) An increase in productivity. Show Answer Correct Answer: D) An increase in nominal wages. ← PreviousNext →Related QuizzesEconomics QuizzesMacroeconomics Quiz 1Macroeconomics Quiz 2Macroeconomics Quiz 3Macroeconomics Quiz 4Macroeconomics Quiz 5Macroeconomics Quiz 6Macroeconomics Quiz 7Macroeconomics Quiz 8Macroeconomics Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books