This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 114 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 114 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the difference between inflation targeting and the Taylor rule? A) Inflation targeting is backward-looking while the Taylor rule is forward-looking. B) Inflation targeting is forward-looking while the Taylor rule is backward-looking. C) Inflation targeting is less restrictive, while the Taylor rule is more restrictive. D) The Central Bank's success is easier to judge using the Taylor rule. Show Answer Correct Answer: B) Inflation targeting is forward-looking while the Taylor rule is backward-looking. 2. Sara is an economist who wants to measure the health of the nation's economy based on the total value of all final goods and services produced. Which would be the most useful economic indicator that Sara could use? A) Gross Domestic Product (GDP). B) Unemployment Rate. Show Answer Correct Answer: A) Gross Domestic Product (GDP). 3. If the central bank lowers the interest rate, what kind of credit will commercial banks be able to give? A) Increased. B) Decrease. C) Does not change. D) All wrong. Show Answer Correct Answer: A) Increased. 4. Is the interest rate that the Fed charges banks to borrow money from them. A) Money supply. B) Discount rate. C) Reserve requirement. D) Check clearing. Show Answer Correct Answer: B) Discount rate. 5. The "Private sector" is firms owned by shareholders and individuals A) True. B) False. Show Answer Correct Answer: A) True. 6. What is the main area of study in macroeconomics? A) The choices and personal finances of individuals. B) The use of resources and production by corporations. C) The performance of the national economy. D) The ways the individuals affect the choices of corporations. Show Answer Correct Answer: C) The performance of the national economy. 7. Which of the following is an example of a nonmarket transaction? A) Having a garage sale to help pay for your family vacation next summer. B) Helping your elderly neighbor with their yard work. C) Paying a web designer to create a new website for your business. D) None of above. Show Answer Correct Answer: B) Helping your elderly neighbor with their yard work. 8. A Recessionary Gap Is What? A) Output is low and unemployment is more than the natural rate of unemployment. B) Laws that reduce inflation and decrease GDP. C) A gap with higher prices and a decrease in GDP. D) Laws that reduce unemployment and increase GDP. Show Answer Correct Answer: A) Output is low and unemployment is more than the natural rate of unemployment. 9. Among the problems studied in macroeconomics are ..... A) Inflation rate in Malaysia. B) Price of inferior good. C) Supply for smartphone. D) Market for Perodua car. Show Answer Correct Answer: A) Inflation rate in Malaysia. 10. What are the three economic goals of policy makers? A) Economic growth, low unemployment, and stable prices. B) High inflation, high interest rates, and high taxes. C) Government control, income inequality, and international trade. D) Consumer spending, business investment, and government spending. Show Answer Correct Answer: A) Economic growth, low unemployment, and stable prices. 11. Low reserve requirements A) Lower the money supply. B) Increase the money supply. Show Answer Correct Answer: B) Increase the money supply. 12. Which set of numbers would be most alarming to officials monitoring the OVERALL economic health of an economy? A) 4% Unemployment, 2% inflation, 0% growth. B) 6% Unemployment, 2% inflation, 3% growth. C) 6.5% unemployment, 0% inflation, -3% growth. D) 8% unemployment, 4% inflation, -2% growth. Show Answer Correct Answer: D) 8% unemployment, 4% inflation, -2% growth. 13. The IS curve shifts to the left due to..... until..... A) Falling investment increases income and employment. B) Falling investment reduces income and employment. C) Increased investment, increasing the amount of income and employment. D) Increased investment, reduces the amount of income and employment. Show Answer Correct Answer: B) Falling investment reduces income and employment. 14. Elasticity refers to A) How producers of goods and services react to price changes. B) How consumers of goods and services react to price changes. C) How far a supply of scarce goods can be stretched. D) How often the price of a good or service changes when quantity demanded changes. Show Answer Correct Answer: B) How consumers of goods and services react to price changes. 15. Which of following leads to better economic development of country? A) Rapid circular flow of income. B) More injection. C) No leakages. D) All of the above. Show Answer Correct Answer: D) All of the above. 16. Most expensive to start A) Sole Proprietorship. B) Partnership. C) Corporation. D) Limited Liability Partnership. Show Answer Correct Answer: C) Corporation. 17. A country can have a comparative advantage in everything they produce. A) True. B) False. Show Answer Correct Answer: B) False. 18. Expansionary fiscal policy involves A) Increasing government purchases or decreasing taxes. B) Increasing the money supply and decreasing interest rates. C) Increasing taxes or decreasing government purchases. D) Decreasing the money supply and increasing interest rates. Show Answer Correct Answer: A) Increasing government purchases or decreasing taxes. 19. A four sector model includes foreign trade. A) True. B) False. Show Answer Correct Answer: A) True. 20. Growth accounting enables us to: A) Discover how long it takes the economy to grow. B) Discover the effects of technological progress on economic growth. C) Compare growth rates across countries. D) Better calculate real GDP per capita. E) Analyze the differences in human capital attainment across countries. Show Answer Correct Answer: B) Discover the effects of technological progress on economic growth. ← 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