This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 186 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 186 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the purpose of valuing goods and services at market prices in GDP computation? A) To reflect how much people are willing to pay for a good or service. B) To avoid double counting of intermediate goods. C) To account for changes in quantities produced. D) To estimate the value of imputed goods and services. Show Answer Correct Answer: A) To reflect how much people are willing to pay for a good or service. 2. Macroeconomics is the study of economy wide phenomena including inflation, unemployment, and economic growth. A) True. B) False. Show Answer Correct Answer: A) True. 3. Which phase of the business cycle would be most closely associated with an economic contraction? Select one: A) Peak. B) Recession. C) Trough. D) Recovery. Show Answer Correct Answer: B) Recession. 4. In the short run, an increase in the Money Supply pushes interest rates ....., while in the long run interest rates ..... A) Down, increase. B) Down, don't change. C) Up, increase. D) Up, don't change. Show Answer Correct Answer: B) Down, don't change. 5. Keynes's lecturer in economics at Cambridge University was- A) David Ricardo. B) Milton Friedman. C) Paul Samuelson. D) Alfred Marshall. Show Answer Correct Answer: D) Alfred Marshall. 6. Country A's growth rate in per capita real gross domestic product (GDP) has been consistently higher than that of Country B. Which of the following factors can account for these differences in the per capita GDP growth rates? A) Country B's government gives more investment tax credits. B) The labor force of Country A is becoming more skilled than the labor force of Country B. C) The natural rate of unemployment is higher in Country A. D) Country A's central bank is less effective at controlling the inflation rate. E) Although the populations of Countries A and B are the same, Country A has twice as many people who are retired. Show Answer Correct Answer: B) The labor force of Country A is becoming more skilled than the labor force of Country B. 7. Long-run economic growth will be sustainable: A) Because pollution and urban sprawl are not real problems. B) As there are plenty of natural resources still left and these can be consumed in the future. C) If it can continue in spite of the limited supply of natural resources and the impact of growth on environment. D) As the natural resource scarcity and other environmental issues are not really as serious as they seem. E) Because there will always be natural resources available to purchase from developing nations where pollution is not an environmental issue. Show Answer Correct Answer: C) If it can continue in spite of the limited supply of natural resources and the impact of growth on environment. 8. The total population of an economy is 175 million, the labor force is 125 million, and the number of employed workers is 117 million. The unemployment rate for this economy is: A) 3.3 percent. B) 5.8 percent. C) 6.4 percent. D) 7.8 percent. Show Answer Correct Answer: C) 6.4 percent. 9. All the following are the objectives of monetary policy except ..... A) To achieve the balance of payment. B) To achieve full employment of resources. C) To maintain domestic price instability. D) To achieve higher economic growth. Show Answer Correct Answer: C) To maintain domestic price instability. 10. The natural rate of unemployment is between: A) 3% and 6%. B) 2% and 4%. C) 4% and 7%. D) 4% and 6%. Show Answer Correct Answer: D) 4% and 6%. 11. Why economic modeling need to be simplicated? A) To make the model more realistic. B) To mislead by ignoring important features of the economy. C) To clarify thinking by focusing on underlying connections. D) To make the model more complicated. Show Answer Correct Answer: C) To clarify thinking by focusing on underlying connections. 12. Suppose autonomous consumption is $ 20, investment is $ 30, government expenditure is 40, net exports 10. Assume the mpc=0.7 and the tax rate=0.2. What is the equilibrium GDP for the open economy? A) AE = 100 + 0.56Y. B) C = 20 + 0.56Y. C) $ 227.27. D) None of above. Show Answer Correct Answer: C) $ 227.27. 13. What type of economy is the USA? A) Market. B) Command. C) Mixed. D) None of above. Show Answer Correct Answer: A) Market. 14. Due to the presence of diminishing returns to capital, doubling the amount of physical capital available for one worker to use will: A) Decrease output by less than a factor of two. B) Increase output by less than a factor of two. C) Increase output by exactly a factor of two. D) Increase output by more than a factor of two. E) Decrease output by more than a factor of two. Show Answer Correct Answer: B) Increase output by less than a factor of two. 15. Which of these is not a benefit of HS2 to Bentley? A) Improved connectivity with the rest of UK. B) Reduction in delivery times as there will be less congestion. C) New workers from around the country are able to join the firm and commute in. D) Bentley will have to pay less tax to the government. Show Answer Correct Answer: D) Bentley will have to pay less tax to the government. 16. This type of tax takes a higher percentage of a lower wage earner's income A) Progressive. B) Proportional. C) Regressive. D) Flat. Show Answer Correct Answer: C) Regressive. 17. The Federal Reserve's two primary goals DO NOT include A) Maximum sustainable employment. B) Stable inflation. C) Diversification of the economy. D) None of above. Show Answer Correct Answer: C) Diversification of the economy. 18. Which factor most directly affects the quantity of a good or service demanded in the market? A) Producer expectations. B) Changes in costs of resources. C) Safety regulations. D) . changes in related goods. Show Answer Correct Answer: D) . changes in related goods. 19. Fiscal Policy is concerned with A) Government Spending and taxation. B) Consumer spending and productivity. C) Government spending and the money supply. D) Taxation and inflation. Show Answer Correct Answer: A) Government Spending and taxation. 20. Percent increase in the overall level of prices per year A) Inflation Rate. B) Aggregate Demand. C) Budget. D) Budget Surplus. Show Answer Correct Answer: A) Inflation Rate. ← 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