This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 116 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 116 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Central bank is owned and controlled by government A) TRUE. B) FALSE. Show Answer Correct Answer: A) TRUE. 2. If the central bank of a country decides to reduce the short-term interest rates, this likely means that ..... A) The central bank is worried about inflation and wants to stop it. B) The central bank is worried about the value of the domestic currency and wants to boost it. C) The central bank is worried about an imminent recession and wants to boost output. D) The economy is booming and the central bank is trying to cool it down. Show Answer Correct Answer: C) The central bank is worried about an imminent recession and wants to boost output. 3. A person's ability to lift heavy objects would be an example of which of the following Factors of Production? A) Land. B) Labor. C) Capital. D) Entrepreneurship. Show Answer Correct Answer: B) Labor. 4. Demand curve A) A curve that shows the relationship between the price of a product and the quantity of the product demanded. B) The study of how society manages its scarce resourcesresources are of equal quality and equally suited for the production of both commodities. C) Resources are of equal quality and equally suited for the production of both commodities. D) The quantity of a good or service that consumers are willing and able to buy. Show Answer Correct Answer: A) A curve that shows the relationship between the price of a product and the quantity of the product demanded. 5. Which of the following is an example of a stock variable A) Size of population. B) Capital formation. C) Investment during a year. D) Saving of households. Show Answer Correct Answer: A) Size of population. 6. Based on typical labor utilization patterns across the business cycle, productivity(output per hours worked) is most likely to be highest: A) At the peak of a boom. B) Into a maturing expansion. C) At the bottom of a recession. D) None of above. Show Answer Correct Answer: C) At the bottom of a recession. 7. Which of the following headlines is more closely related to what microeconomics study than to what macroeconomics study? A) Unemployment rate falls from 7.5 percent to 7.3 percent. B) Real GDP falls by 0.4 percent in the third quarter. C) Inflation was 2.4 percent last year. D) The price of gasoline rises due to rising oil prices. Show Answer Correct Answer: D) The price of gasoline rises due to rising oil prices. 8. A liquidity trap occurs when conventional monetary policy is ineffective because A) The short-run Phillips curve is negatively sloped. B) The public will not buy or sell Treasury bills. C) The unemployment rate can't go below 5%. D) The nominal interest rate can't be negative. E) The real interest rate can't be negative. Show Answer Correct Answer: D) The nominal interest rate can't be negative. 9. Which of the following best describes "occurrences when producing or consuming a good causes an impact on a third party not directly related to the transaction" ? A) Subsidy. B) Externality. C) Inflation. D) Depression. Show Answer Correct Answer: B) Externality. 10. Which of these is NOT a characteristic of an unemployed person? A) He/she does not work. B) He/she has made specific efforts to find a job. C) He/she is laid off from a job in the succeeding months. D) He/she is undergoing a career change. Show Answer Correct Answer: A) He/she does not work. 11. The relationship between price and the quantity supplied of a certain good or service A) Price floor. B) Inputs. C) Supply. D) Total surplus. Show Answer Correct Answer: C) Supply. 12. Benefit received by employees in addition to wages and salaries. Includes paid vacations, sick leave, retirement, insurance A) Cooperative. B) Business organization. C) Unlimited liability. D) Fringe Benefits. E) Corporation. Show Answer Correct Answer: D) Fringe Benefits. 13. The objectives of government taxation are as follows except A) To increase inequality of income distribution between the rich and the poor. B) To restrain the consumer from consuming unhealthy products. C) To protect local and infant industries. D) To increase government revenue. Show Answer Correct Answer: A) To increase inequality of income distribution between the rich and the poor. 14. An Inflationary Gap Is What? A) Laws that reduce inflation and decrease GDP. B) Output is high and unemployment is less than the natural rate of unemployment. C) A gap with higher prices and a decrease in GDP. D) Laws that reduce unemployment and increase GDP. Show Answer Correct Answer: B) Output is high and unemployment is less than the natural rate of unemployment. 15. Suppose people's expectation of inflation goes down over time. Holding everything else constant, how would this change the position of the aggregate supply (AS) curve? A) The entire curve will shift to the right. B) The entire curve will shift to the left. C) The curve will shift down, but not to the right or left. D) The curve will shift up, but not to the right or left. E) The AS curve would not shift. Show Answer Correct Answer: C) The curve will shift down, but not to the right or left. 16. CPI for year one was 100 and the CPI for year two was 102, you could conclude there was ..... inflation in that country. A) 2%. B) 20%. C) 15%. D) 7%. Show Answer Correct Answer: A) 2%. 17. Monetary base (B) = A) Currency (C) + Reserves (R). B) Currency (C) + Demand (D). C) Currency (C)-Reserves (R). D) Currency (C)-Demand (D). Show Answer Correct Answer: A) Currency (C) + Reserves (R). 18. Households' decision to buy less rice reduced the profit of rice farmers. Which branch of economics covers the Households' decision? A) Microeconomics. B) Macroeconomics. Show Answer Correct Answer: A) Microeconomics. 19. Assigning workers one task that is to be performed repeatedly is referred to as A) A division of labor. B) Productivity. C) Specialization. D) A cottage industry. Show Answer Correct Answer: C) Specialization. 20. Suppose the government increases the amount of money it spends. This is an example of which of these? A) Using fiscal policy to decrease inflation. B) Using fiscal policy to stimulate the economy. C) Using monetary policy to stimulate the economy. D) Using monetary policy to slow down the economy. Show Answer Correct Answer: B) Using fiscal policy to stimulate the economy. ← 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