This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 117 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 117 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Economic independence or self-sufficiency A) Winning. B) Autarky. C) Command economy. D) Capitalism. Show Answer Correct Answer: B) Autarky. 2. Which of the following typically occurs during an expansionary phase of a business cycle? A) Nominal interest rates decrease. B) Income taxes decrease. C) The price level decreases. D) Government transfer payments increase. E) Employment increases. Show Answer Correct Answer: E) Employment increases. 3. Suppose that in the medium run most people decrease their expectations about inflation. What change would we expect to occur in the AD/AS model? A) The AS curve would shift upwards. B) The AS curve would shift downwards. C) The AD curve would shift upwards. D) The AD curve would shift downwards. E) No change would occur. Show Answer Correct Answer: B) The AS curve would shift downwards. 4. Which of the following would most likely be the immediate result if the United States increased tariffs on most foreign goods? A) The United States standard of living would be higher. B) More foreign goods would be purchased by Americans. C) Prices of domestic goods would increase. D) Large numbers of United States workers would be laid off. E) The value of the United States dollar would decrease against foreign currencies. Show Answer Correct Answer: C) Prices of domestic goods would increase. 5. The HIGHEST Point in business cycle A) Peak. B) Trough. C) Contraction. D) Recession. Show Answer Correct Answer: A) Peak. 6. Which of the following contributes to economic development? A) Low saving and investment rates. B) A command socialist economic system. C) Investment in infrastructure. D) Complete absence of government involvement. E) High rates of absenteeism at the workplace. Show Answer Correct Answer: C) Investment in infrastructure. 7. The resources such as labor material, and machinery that are used to produce good and services; also called factor of production A) Law of demand. B) Inputs. C) Outputs. D) Factors of production. Show Answer Correct Answer: B) Inputs. 8. The government sources of revenue and plans of expenditure for an year is known as ..... A) Revenue plan. B) Expenditure plan. C) Budget. D) Fiscal policy. Show Answer Correct Answer: C) Budget. 9. Which of the following would be INCLUDED when calculating the GDP for the U.S.? A) Toys that Wal-Mart has imported from their factories in China. B) A used car bought from Frontier Motors. C) Getting $ 20 from your mom for mowing the lawn. D) A Tesla car that has been manufactured in California. Show Answer Correct Answer: D) A Tesla car that has been manufactured in California. 10. Which of the following statements are true about Frictional Unemployment? A) People change jobs due to a change in the technology. B) People change jobs because of the shift in the economy. C) People are looking for jobs because they were terminated due demand changes. D) None of the statements above are correct. Show Answer Correct Answer: C) People are looking for jobs because they were terminated due demand changes. 11. Why may full employment and price stability conflict as government aims? A) Full employment may benefit from a fall in the exchange rate whereas price stability may benefit from a rise in the exchange rate. B) Full employment may benefit from an increase in aggregate supply whereas price stability may benefit from a decrease in aggregate supply. C) To achieve full employment may require a decrease in aggregate demand whereas to achieve price stability may require an increase in aggregate demand. D) To achieve full employment may require an increase in the rate of interest whereas price stability may require a decrease in the rate of interest. Show Answer Correct Answer: A) Full employment may benefit from a fall in the exchange rate whereas price stability may benefit from a rise in the exchange rate. 12. A worker in Ecuador can earn $ 3 per day making cotton cloth on a hand loom. A worker in the United States can earn $ 70 per day making cotton cloth with a mechanical loom. What accounts for the difference in wages? A) U.S. textile workers belong to a union. B) There is little demand for cotton cloth in Ecuador and great demand in the U.S. C) Labor is more productive making cotton cloth with a mechanical loom than with a hand loom. D) Ecuador has a low-wage policy to make its textile industry more competitive in world markets. Show Answer Correct Answer: C) Labor is more productive making cotton cloth with a mechanical loom than with a hand loom. 13. Currently, the upper bound ceiling and the lower bound for the Liquidity Adjustment (LAF) Corridor are: A) MSF and SDF respectively. B) SDF and MSF respectively. C) Repo and Reverse Repo respectively. D) Reverse Repo and Repo rate respectively. Show Answer Correct Answer: A) MSF and SDF respectively. 14. The federal government tries to maintain price stability by limiting ..... A) Inflation. B) Money Supply. C) Unemployment. D) Equity. Show Answer Correct Answer: A) Inflation. 15. Social welfare programs that people are"entitled to" and benefit from if they meet certain eligibility requirements, such as being at a particular income level, or age. A) Mandatory spending. B) Discretionary spending. C) Entitlements. D) Tariffs. Show Answer Correct Answer: C) Entitlements. 16. The interest rate charged by the Fed, when lending to a financial institution A) Discount rate. B) Interest rate score. C) Variable certificate of deposit. D) None of above. Show Answer Correct Answer: A) Discount rate. 17. Based on a model developed from the economic situation of one person one island; two people one island economy; etc; from an economy without money (moneyless economy) to a money economy (money economy) is it possible to have an economy without interest? So, interest on money..... in the economic model. A) No need. B) Not important. C) Unnecessary and unimportant. D) Very necessary and very important. Show Answer Correct Answer: C) Unnecessary and unimportant. 18. A business where a few people share ownership and responsibility is ..... A) Corporation. B) Oligopoly. C) Partnership. D) Sole proprietorship. Show Answer Correct Answer: C) Partnership. 19. GROSS VALUE= A) NET VALUE + DEPRECIATION. B) NET VALUE-DEPRECIATION. Show Answer Correct Answer: A) NET VALUE + DEPRECIATION. 20. The contractionary fiscal policy is imposed by the government to ..... A) Reduce problems of inflation. B) . reduce problems of deflation. C) Increase aggregate demand. D) Increase the money supply in the economy. Show Answer Correct Answer: A) Reduce problems of inflation. ← 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