This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 254 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 254 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following IS NOT a monetary policy tool of the Federal Reserve? A) Required reserve ratio. B) Buying & selling US Securities. C) Decreasing government spending. D) Discount rate. Show Answer Correct Answer: C) Decreasing government spending. 2. Keynessian Economists argue that government should not intervene the market A) True. B) False. Show Answer Correct Answer: B) False. 3. What is the circular flow model? A) A model that shows the flow of goods and services in an economy. B) A model that shows the flow of money in an economy. C) A model that shows the flow of resources in an economy. D) A model that shows the flow of income in an economy. Show Answer Correct Answer: A) A model that shows the flow of goods and services in an economy. 4. The average propensity to consume is measured by A) C/Y. B) CxY. C) Y/C. D) C+Y. Show Answer Correct Answer: A) C/Y. 5. The circular flow model represents the establishment of market value for: A) Goods and services only. B) Wages and salaries excluding goods and services. C) Profits and rents but not for wages and salaries. D) Profits and rents as well as wages and salaries. Show Answer Correct Answer: D) Profits and rents as well as wages and salaries. 6. The quantity at which quantity demanded and quantity supplied are equal for a certain price level A) Demand. B) Equilibrium Price. C) Equilibrium Quantity. D) Demand Curve. Show Answer Correct Answer: C) Equilibrium Quantity. 7. A decrease in the price of silicon chips and increased production of user-friendly software will affect the price and quantity of computers in which of the following ways? A) Increase Price; Increase Quantity. B) Indeterminate Price; Increase Quantity. C) Increase Price; Indeterminate Quantity. D) Decrease Price; Decrease Quantity. Show Answer Correct Answer: B) Indeterminate Price; Increase Quantity. 8. If the nominal gross domestic product (GDP) of the nation of Hypothetica increased in 2007 relative to the previous year, it must be true that in Hypothetica in 2007 A) Both the price level and the real GDP have increased. B) Neither the price level nor the real GDP has increased. C) The price level increased by a larger percentage than did the real GDP. D) The price level increased by a smaller percentage than did the real GDP. E) The price level and/or the real GDP has increased. Show Answer Correct Answer: E) The price level and/or the real GDP has increased. 9. Of the following groups, the one hurt the LEAST by unanticipated inflation is A) Workers who have cost-of-living adjustments in their labor contracts. B) People who have saved money in accounts with a fixed interest rate. C) Banks that have made long term, fixed rate mortgage loans. D) Consumers who buy goods and services at prevailing market prices. Show Answer Correct Answer: A) Workers who have cost-of-living adjustments in their labor contracts. 10. Actions which are designed to influence the economic activities by controlling aggregate demand and money supply in the economy is known as ..... A) Economic policy. B) Monetary policy. C) Fiscal policy. D) Socio-economic policy. Show Answer Correct Answer: A) Economic policy. 11. The export can food is the macroeconomics A) True. B) False. Show Answer Correct Answer: A) True. 12. Government cutting taxes is an example of ..... A) Fiscal Policy. B) Monetary Policy. Show Answer Correct Answer: A) Fiscal Policy. 13. Under a fixed exchange rate system (A) ..... would be an exogenous monetary policy instrument, whereas under a flexible exchange rate system (B) ..... would be an endogenous monetary policy instrument. A) (A) the exchange rate; (B) the exchange rate. B) (A) the exchange rate; (B) the interest rate. C) (A) the interest rate; (B) the exchange rate. D) (A) the interest rate; (B) the interest rate. Show Answer Correct Answer: A) (A) the exchange rate; (B) the exchange rate. 14. Assume that the reserve requirement is 25 percent. If banks have excess reserves of $ 10, 000, which of the following is the maximum amount of additional money that can be created by the banking system through the lending process? A) $ 2, 500. B) $ 10, 000. C) $ 40, 000. D) $ 50, 000. E) $ 250, 000 . Show Answer Correct Answer: C) $ 40, 000. 15. A competitive market is in Equilibrium when the price has moved to a level at which the quantity demanded of a good is more than the quantity supplied of that good. A) True. B) False. Show Answer Correct Answer: B) False. 16. Jack saves his money in a piggy bank. He is using money as a A) Medium of exchange. B) Store of value. C) Unit of measurement. D) Bartering tool. Show Answer Correct Answer: B) Store of value. 17. What is the recovery/expansion in the business cycle? A) The accumulation of government deficits over the years. B) The highest point of Real GDP. C) The lowest point of Real GDP. D) The period of rising Real GDP. Show Answer Correct Answer: D) The period of rising Real GDP. 18. What is the difference between GDP and GNP? A) GNP measures value of all the goods produced within a country's borders, while GDP measures value of all the goods made by a country's citizens. B) Finding GDP is more complex than finding GNP. C) GDP measures value of all the goods produced within a country's borders, while GNP measures value of all the goods made by a country's citizens. D) None of above. Show Answer Correct Answer: C) GDP measures value of all the goods produced within a country's borders, while GNP measures value of all the goods made by a country's citizens. 19. Too much demand can lead to A) Unemployment. B) Deflation. C) Increase output. D) Inflation. Show Answer Correct Answer: D) Inflation. 20. Which inflation type is influenced by a surge in consumer demand? A) Cost push inflation. B) Demand pull inflation. C) Stagflation. D) Hyperinflation. Show Answer Correct Answer: B) Demand pull 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