This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 203 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 203 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which part of the business cycle is labeled as #4? A) Peak. B) Contraction/Recession. C) Expansionary/Recovery. D) Trough. Show Answer Correct Answer: C) Expansionary/Recovery. 2. Institution whose financial obligations underlie an economy's money supply. A) Government. B) Central Bank. Show Answer Correct Answer: B) Central Bank. 3. A banking innovation has made it easier for people in Hamsterville to convert their assets into money. As a result, the demand for money has decreased, and this has changed the nominal interest rate.If the central bank wants to counteract this change, which of the following is an appropriate open market operation to achieve that? A) Buy bonds. B) Increase the reserve requirement. C) Decrease taxes. D) Sell bonds. E) Lower the discount rate. Show Answer Correct Answer: D) Sell bonds. 4. In monetary policy, which of the following statements is true:I. Unanticipated expansionary monetary policy will cause real GDP to increase temporarily and unemployment will decrease II. The anticipated expansionary monetary policy does not affect real GDP or unemploymentIII. Restrictive monetary policy results in a reduction in the money supply IV. Restrictive monetary policy will cause real GDP to temporarily decrease and unemployment will increase A) I, II, and III only. B) I, III, and IV only. C) II, III, and IV only. D) I, II, III, IV. Show Answer Correct Answer: D) I, II, III, IV. 5. How is your purchase of a $ 80, 000 Tesla automobile that was produced entirely in China recorded in the U.S. GDP accounts? A) Investment increases by $ 80, 000 and net exports increase by $ 80, 000. B) Net exports decrease by $ 80, 000. C) Consumption increases by $ 80, 000 and net exports decrease by $ 80, 000. D) Net exports increase by $ 80, 000. Show Answer Correct Answer: C) Consumption increases by $ 80, 000 and net exports decrease by $ 80, 000. 6. Taxation is its main source of revenue. A) HOUSEHOLDS. B) FIRMS. C) GOVERNMENT. D) BANKS. E) INTERNATIONAL TRADE. Show Answer Correct Answer: D) BANKS. 7. Total market value of all final goods and services produced in the economy during a given year A) Unemployed. B) Price Level. C) Nominal GDP. D) GDP. Show Answer Correct Answer: D) GDP. 8. When there's a significant spare capacity in the economy, expansionary fiscal policy is: A) Less effective and more inflationary. B) More effective and more inflationary. C) Less effective and less inflationary. D) More effective and less inflationary. Show Answer Correct Answer: D) More effective and less inflationary. 9. The federal government raising money by selling bonds (Treasury Bills, T Bills). A) True. B) False. Show Answer Correct Answer: A) True. 10. In this market, businesses buy resources they need to produce goods and services. A) Factor market. B) Stores. C) Product market. D) Businesses. Show Answer Correct Answer: A) Factor market. 11. What will be the value of Multiplier if MPC = 0.75? A) 4. B) 5. C) 2. D) 3. Show Answer Correct Answer: A) 4. 12. John is a farmer and he is unemployed during the winter months when there is no harvest. Similarly, a hotel employee in a tourist location is unemployed during off-season. What type of unemployment is this? A) Seasonal Unemployment. B) Structural Unemployment. C) Frictional Unemployment. D) Cyclical Unemployment. Show Answer Correct Answer: A) Seasonal Unemployment. 13. Unemployed individuals include the following except: A) Without work or had no job. B) Currently available for work. C) Seeking for work. D) 15 to 64 years old during the reference period . Show Answer Correct Answer: D) 15 to 64 years old during the reference period . 14. According to the CIA World Factbook, the GDP of the United States is approximately A) $ 47 billion. B) $ 3 trillion. C) $ 8 trillion. D) $ 19 trillion. E) $ 27 trillion. Show Answer Correct Answer: D) $ 19 trillion. 15. Which one of the following indicates a contractionary monetary policy? A) A fall in the budget deficit. B) A rise in the money supply. C) An increase in the national debt. D) Appreciation of the exchange rate. Show Answer Correct Answer: D) Appreciation of the exchange rate. 16. What happens during expansionary monetary policy? A) 1-Interest rates increase.2-Borrowing and investments increase3-Aggregate demand increases. B) 1-Interest rates increase.2-Borrowing and investments decrease3-Aggregate demand decreases. C) 1-Interest rates decrease.2-Borrowing and investments decrease3-Aggregate demand decreases. D) 1-Interest rates decrease.2-Borrowing and investments increase3-Aggregate demand increases. Show Answer Correct Answer: D) 1-Interest rates decrease.2-Borrowing and investments increase3-Aggregate demand increases. 17. The main goal of the Federal Reserve System was/is to A) Conduct fiscal policy. B) Conduct monetary policy. C) Prevent bank runs. D) Make money. Show Answer Correct Answer: C) Prevent bank runs. 18. To make Gross Domestic Product a better measure of comparative living standards it needs to be adjusted by A) Deducting the effects of exports and inflation. B) Deducting the effects of imports and exports. C) Deducting the effects of population change and exports. D) Deducting the effects of population change and inflation. Show Answer Correct Answer: D) Deducting the effects of population change and inflation. 19. A market structure where one business controls the selling of a product ..... A) Monopoly. B) Monopolistic. C) Oligopoly. D) Pure or perfect competition. Show Answer Correct Answer: A) Monopoly. 20. Which of the following is an example of expansionary policy? A) The Fed sells bonds. B) The Fed raises reserve requirements. C) The Fed buys bonds. D) The Fed raises the Fed funds rate. Show Answer Correct Answer: C) The Fed buys bonds. ← 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