This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 18 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 18 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. ..... is the price paid for the use of money. A) Gold. B) Monetary policy. C) Fiscal policy. D) The interest rate. Show Answer Correct Answer: D) The interest rate. 2. Which is the largest item in the aggregate demand in the economy A) Consumption demand. B) Investment demand. C) Government demand. D) Net export demand. Show Answer Correct Answer: A) Consumption demand. 3. Okun's law indicates that for: A) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 2 percent GDP gap is generated. B) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 5 percent GDP gap is generated. C) A 5 percent GDP gap, a 1 percent increase in the natural unemployment rate is generated. D) A 2 percent GDP gap, a 2 percent increase in the actual unemployment rate is generated. Show Answer Correct Answer: A) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 2 percent GDP gap is generated. 4. The first coins were made of ..... A) Cheese. B) Bone. C) Gold. D) Jade. Show Answer Correct Answer: C) Gold. 5. The production of which type of product has to be financed by taxation? A) Those that are unprofitable. B) Those that are both non rival and non excludable. C) Those that have higher social costs than private costs. D) Those that are luxury items. Show Answer Correct Answer: B) Those that are both non rival and non excludable. 6. " Free to Choose" is best characterized as an example of what type of economics A) Normative; the destructive nature of much market activity, and how more government intervention is needed to correct the excess and abuses of the market system. B) Normative; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. C) Positive; the destructive nature of much market activity, and how more government intervention is needed to correct the excess and abuses of the market system. D) Positive; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. Show Answer Correct Answer: B) Normative; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. 7. Refers to government revenue, spending, and debtFiscal A) Fractional Reserve Banking. B) Fiscal. C) Legal Reserves. D) Reserve system. Show Answer Correct Answer: B) Fiscal. 8. Defined as the percentage of the total number of people in the labor force who are unemployed A) Underemployment Rate. B) Inflation Rate. C) CPI. D) Aggregate Supply. Show Answer Correct Answer: A) Underemployment Rate. 9. When producers offer fewer products for sale at the same prices A) Supply curve shifts right. B) Supply curve shifts left. C) They expect subsidies. D) The price per unit has decrease. Show Answer Correct Answer: B) Supply curve shifts left. 10. Which causes United States GDP to increase? A) Japan buys government securities. B) The United States sells more goods to Japan. C) Japan sells Japanese securities to the U.S. D) The United States buys more Japanese goods. Show Answer Correct Answer: B) The United States sells more goods to Japan. 11. Your Mail lady is an example of ..... A) Land. B) Labor. C) Entrepreneurs. D) Capital. Show Answer Correct Answer: B) Labor. 12. A political system headed by a dictator that calls for extreme nationalism and racism and no tolerance of opposition A) Socialism. B) Fascism. C) Mean. D) Communism. Show Answer Correct Answer: B) Fascism. 13. Imagine you are the President. You want to influence the economy by adjusting government spending and revenue collection. What is this strategy called? A) Monetary Policy. B) Fiscal Policy. C) Congressional Policy. D) Executive Policy. Show Answer Correct Answer: B) Fiscal Policy. 14. Suppose there are two economies, Xenon and Yantel, which have the same PP curves and are currently at the same point on their respective curve. If Xenon then decides to devote more resources to capital goods production relative to consumer goods production compared to Yantel, then we would most likely expect: A) Xenon to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Yantel. B) Yantel to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Xenon. C) Yantel to increase its current production of consumer goods and, as a result, its current PP curve to shift inward (to the left). D) There would be no shift in the current or future PP curve for either Xenon or Yantel; there would only be a difference in the current composition of national output between consumer and capital goods. Show Answer Correct Answer: A) Xenon to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Yantel. 15. Petroleum income tax and stamp duties are two examples of the government revenues. These revenues fall under which category? A) Direct taxes. B) Indirect tax. C) Non-tax revenue. D) Non-revenue receipts. Show Answer Correct Answer: A) Direct taxes. 16. The law of Demand states ..... A) That the higher the price, the more producers will make. B) The lower the price, the less producers will make. C) The higher the price, the more consumers will buy. D) The lower the price, the more consumers will buy. Show Answer Correct Answer: D) The lower the price, the more consumers will buy. 17. Government deficit A) A government is spending more than taxing. B) A government is taxing more than spending. Show Answer Correct Answer: A) A government is spending more than taxing. 18. Assume the government of Hamsterville increases taxation and reduces government spending. These actions cause a fall in total spending in the economy.Which of the following is the best description of the type of unemployment the fall in output will have? A) Frictional unemployment. B) Cyclical unemployment. C) Structural unemployment. D) Natural Rate of Unemployment. Show Answer Correct Answer: B) Cyclical unemployment. 19. The Government electrical center is the macroeconomics A) True. B) False. Show Answer Correct Answer: A) True. 20. What is the study of the behavior and decision making of entire economies called? A) Microeconomics. B) Macroeconomics. C) Gross Domestic Product (GDP). D) Business Cycle. Show Answer Correct Answer: B) Macroeconomics. ← 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