This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 257 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 257 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If the Federal Reserve wanted to stimulate the U.S. economy and reduced unemployment, it would A) Cause interest rates to decrease because low interest rates encourage business growth and expansion. B) Cause interest rates to rise because high interest rates encourage growth and expansion. C) Increase the discount rate it charges banks. D) Reduce the money supply. Show Answer Correct Answer: A) Cause interest rates to decrease because low interest rates encourage business growth and expansion. 2. Fiscal policy is defined as: A) The use of government taxing and spending to promote economic stability. B) The policy of laissez-faire. C) A set of government actions designed to increase unemployment over 5%. D) The use of government quotas to decrease GDP and unemployment. Show Answer Correct Answer: A) The use of government taxing and spending to promote economic stability. 3. Contractionary monetary policy will tend to have what effect? A) A higher nominal interest rate. B) A decrease in aggregate demand. C) A higher nominal interest rate and a decrease in the aggregate demand curve. D) A lower nominal interest rate and an increase in the aggregate demand curve. Show Answer Correct Answer: C) A higher nominal interest rate and a decrease in the aggregate demand curve. 4. Which of the following is NOT an example of a bank asset? A) Government bonds. B) Checkable deposits. C) Commercial loans. D) Reserves. E) All of these are examples of bank assets. Show Answer Correct Answer: B) Checkable deposits. 5. Which of the following possitions has the largest share in a GDP in Poland? A) Personal consumption expediture. B) Gros privete domestic investments. C) Government expenditure. D) Net export. Show Answer Correct Answer: A) Personal consumption expediture. 6. The "Public sector" refers to the part of the economy that is controlled by the government A) True. B) False. Show Answer Correct Answer: A) True. 7. Reduces aggregate demand (a decrease in government purchases of goods and services, an increase in taxes, a decrease in government transfers) A) Expansionary Fiscal Policy. B) Contractionary Fiscal Policy. C) Discretionary Fiscal Policy. D) Budget. Show Answer Correct Answer: B) Contractionary Fiscal Policy. 8. Microeconomics is a ..... equilibrium analysis as it studies. A) Partial. B) General. Show Answer Correct Answer: A) Partial. 9. Supply side economics has been widely criticised because the reduction of taxes does not lead to what? A) An increase in taxes collected. B) Shopkeeper's stress. C) Reagonomics. D) Truth, justice and the American way. Show Answer Correct Answer: A) An increase in taxes collected. 10. If there is a shortage of beef at Fry's which of the following is the MOST likely to happen? A) They will produce more beef. B) The price will rise. C) The price will fall. D) There will be no change. Show Answer Correct Answer: B) The price will rise. 11. Use to calculate the inflation rate in the country A) CPI. B) Unemployment rate. C) GDP. D) None of above. Show Answer Correct Answer: A) CPI. 12. The ..... is the large economics that respond to the country A) Microeonomics. B) Macroeconomics. Show Answer Correct Answer: B) Macroeconomics. 13. In a fractional reserve banking system ..... A) Banks do not change the money supply. B) Bank runs are not a critical concern. C) Banks may loan out all or some of their customers' deposits. D) Banks must keep all of their customers' deposits in a secure vault. Show Answer Correct Answer: C) Banks may loan out all or some of their customers' deposits. 14. Stock prices are going down in a: A) Bear market. B) Bull market. C) Peak market. D) Soft market. Show Answer Correct Answer: A) Bear market. 15. Assume that milk is an inferior good.Assuming all other factors remain constant, if the income of milk buyers increases, what will happen to the equilibrium price and quantity of milk? A) We cannot determine what happens to price, but quantity will increase. B) Price will decrease and quantity will increase. C) Price will decrease and quantity will decrease. D) Price will increase, but we cannot determine what happens to quantity. E) Price will increase and quantity will decrease. Show Answer Correct Answer: C) Price will decrease and quantity will decrease. 16. Security and defense expenditure fall under A) Operating expenditure. B) Development expenditure. C) Operational and development expenditure. D) None of the above. Show Answer Correct Answer: B) Development expenditure. 17. The smallest fraction of bank deposits a bank is required by the central bank to hold A) Reserve ratio. B) Capital requirement. C) Deposit assurance. D) Mortgage insurance. Show Answer Correct Answer: A) Reserve ratio. 18. The following are things that can be affected by the size produced by the GDP deflator..... A) CPI Rate Differences. B) Differences in Inflation Rates. C) Change in Nominal GDP. D) Price of Imported Goods. Show Answer Correct Answer: B) Differences in Inflation Rates. 19. Which type of economic policy encourages the nation's economic goals through the use of government spending and taxation? A) Fiscal. B) Monetary. Show Answer Correct Answer: A) Fiscal. 20. Which is an example of government spending? A) Road Construction. B) Clothes. C) Housing. D) Food. Show Answer Correct Answer: A) Road Construction. ← 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