This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 156 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 156 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Macro economics is a study of A) Inidividuals. B) Firms. C) A nation. D) Aggregates. Show Answer Correct Answer: D) Aggregates. 2. If the Fed wanted to contract or tighten the economy to help fight inflation, they might A) Increase reserves to limit what banks can loan out. B) Lower the interest rate. C) Decrease reserves allowing banks to loan more. D) Decrease government spending. Show Answer Correct Answer: A) Increase reserves to limit what banks can loan out. 3. Which of the following claims is consistent with the views of main stream economists A) If we increase the rate of inflation from 3% to 6% then the rate of unemployment will temporarily fall. B) If we increase the rate of inflation from 3% to 6% then the rate of unemployment will temporarily rise. C) If we increase the rate of inflation from 3% to 6% then the rate of unemployment will permanently fall. D) If we increase the rate of inflation from 3% to 6% and the rate of unemployment would temporarily rise. E) If we increase the rate of inflation from 3% to 6% then the rate of employment will temporarily fall. Show Answer Correct Answer: A) If we increase the rate of inflation from 3% to 6% then the rate of unemployment will temporarily fall. 4. An increase in the demand for money will result in..... A) The LM curve shifts upward and puts pressure on income. B) The LM curve shifts upwards and lowers interest rates. C) The LM curve shifts downwards and increases interest rates. D) The LM curve shifts downwards and puts pressure on income. Show Answer Correct Answer: A) The LM curve shifts upward and puts pressure on income. 5. The public debt increases when A) The government collects more in taxes than it spends. B) The government runs a budget deficit. C) The budget balance is positive. D) The government enacts contractionary fiscal policy. Show Answer Correct Answer: B) The government runs a budget deficit. 6. Occurs when an individual, business, or gov't. budgets more spending than there is revenue available to pay for the spending, over a specific period of time A) Budget Deficit. B) Inflation. C) Peak. D) Trough. Show Answer Correct Answer: A) Budget Deficit. 7. What type of corporation may be owned by just a few people and does not offer its shares for sale to the general public? A) Limited. B) Franchise. C) C Corporation. D) Private. Show Answer Correct Answer: D) Private. 8. The UK economy is most likely to be in the boom phase of the economic cycle when there is a rise in A) The demand for imports. B) The saving ratio. C) Spare capacity. D) Business pessimism. Show Answer Correct Answer: A) The demand for imports. 9. ..... Advantage:When a producer can produce a good/service at a lower opportunity cost than another producer. A) Absolute. B) Consumption. C) Hippopotamus. D) Comparative. Show Answer Correct Answer: D) Comparative. 10. When a currency becomes more valuable in terms of other currencies, it ....., and when it becomes less valuable in terms of other currencies, it ..... A) Appreciates; Depreciates. B) Decreases; Increases. C) Depreciates; Appreciates. D) None of above. Show Answer Correct Answer: A) Appreciates; Depreciates. 11. ..... is inflation that is caused by an increase in aggregate demand. A) Demand-Pull Inflation. B) Demand-Push Inflation. C) Cost-Push Inflation. D) Cost-Pull Inflation. Show Answer Correct Answer: A) Demand-Pull Inflation. 12. GDP is used to ..... ? A) Measure how an economy is doing. B) Measure Government spending. C) Measure Private sector spending. D) None of above. Show Answer Correct Answer: A) Measure how an economy is doing. 13. Which of the following is not an example of labor market reform? A) Reducing the power of labor unions. B) Reducing unemployment benefits. C) Abolishing or reducing the national minimum wage. D) Tax cuts to create incentives to work. Show Answer Correct Answer: D) Tax cuts to create incentives to work. 14. Autonomous consumption is indicated by ..... in the consumption function. A) C. B) AC. C) C. D) None of above. Show Answer Correct Answer: A) C. 15. What is the government's goal to achieve? A) A low, fluctuating rate of inflation. B) A high, stable rate of inflation. C) A low, stable rate of inflation. D) A low, stable of deflation. Show Answer Correct Answer: C) A low, stable rate of inflation. 16. When a national bank controls the money supply it is using A) Monetary policy. B) Fiscal policy. C) Keynesian policy. D) Financial policy. Show Answer Correct Answer: A) Monetary policy. 17. ..... an economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services A) Traditional Economy. B) Market Economy. C) Command Economy. D) Mixed Economy. Show Answer Correct Answer: B) Market Economy. 18. Comparisons of per capita gross domestic product between countries ..... A) Provide a good measure of relative living standards. B) Is a useless task because each country uses a different method of calculating. C) Provide information about productive capabilities, not relative standards of living. D) Provide an accurate gauge of absolute standards of living. Show Answer Correct Answer: A) Provide a good measure of relative living standards. 19. Define inflation and discuss its causes. A) Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, purchasing power is falling. B) Inflation is the rate at which the general level of prices for goods and services is rising, but purchasing power remains unaffected. C) Inflation is the rate at which the general level of prices for goods and services is falling and, consequently, purchasing power is rising. D) Inflation is the rate at which the general level of prices for goods and services remains constant, and purchasing power remains stable. Show Answer Correct Answer: A) Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, purchasing power is falling. 20. Which of these is MOST LIKELY to occur after the government increases taxes? A) Annual deficits increase. B) The national debt increases. C) Consumer spending decreases. D) Government programs decrease. Show Answer Correct Answer: C) Consumer spending decreases. ← 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