This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 27 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 27 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Other things being equal or constant. A) Ceteris paribus. B) Citiris paribus. C) Ceteris parebus. D) Ceteris paribous. Show Answer Correct Answer: A) Ceteris paribus. 2. Marginalv A) A simplified representation that is used to study a real situation is called:. B) "money wage" = money you're paid by an employer for your labor. not adjusted for inflation. C) Additional. D) The claim that, other things being equal, the quantity demanded of a good falls when the price of the good rises. Show Answer Correct Answer: A) A simplified representation that is used to study a real situation is called:. 3. An increase in the supply of a good is caused by: A) A decrease in the input price for production. B) Any resources used to create goods and services. Examples of inputs include labor (workers' time), fuel, materials, buildings, and equipment. C) Each additional unit produced means amounts of the other good (which are ever-increasing) must be given up. D) The claim that, other things being equal, the quantity demanded of a good falls when the price of the good rises. Show Answer Correct Answer: A) A decrease in the input price for production. 4. Macroeconomics theory studies the following EXCEPT ..... A) How to determine international trade activities. B) How to determine the unemployment and inflation rate. C) How to determine the equilibrium income in an economy. D) How to determine type and quality of goods to produce. Show Answer Correct Answer: D) How to determine type and quality of goods to produce. 5. Noah Depiero's cool aunt Angela gave him some money to invest into a publicly traded company in hopes he would strike it rich. Greedy Angela would then take all the money from him. Noah would have invested in what type of business? A) Cooperative. B) Sole Proprietorship. C) Corporation. D) Non-Profit. Show Answer Correct Answer: C) Corporation. 6. Why might the velocity of money change unexpectedly? A) The velocity of money might change unexpectedly due to changes in the popularity of online shopping. B) The velocity of money might change unexpectedly due to changes in the number of banks in the country. C) The velocity of money might change unexpectedly due to changes in the price of gold. D) The velocity of money might change unexpectedly due to factors such as changes in consumer confidence, shifts in government policies, or unexpected economic events. Show Answer Correct Answer: D) The velocity of money might change unexpectedly due to factors such as changes in consumer confidence, shifts in government policies, or unexpected economic events. 7. Total amount of goods and services demanded in the economy at a given overall price level and in a given time period. A) AGGREGATE DEMAND. B) AGGREGATE SUPPLY. Show Answer Correct Answer: A) AGGREGATE DEMAND. 8. How do automatic stabilizers work, both on the taxation side and on the spending side, in a situation where the economy is producing less than potential GDP? A) Automatic stabilizers work by decreasing government spending and increasing tax revenue to stimulate economic activity. B) Automatic stabilizers work by decreasing government spending and keeping tax revenue the same to stimulate economic activity. C) Automatic stabilizers work by increasing government spending and keeping tax revenue the same to slow down economic activity. D) Automatic stabilizers work by increasing government spending and decreasing tax revenue to stimulate economic activity and support individuals and businesses during a recession or when the economy is producing less than potential GDP. . Show Answer Correct Answer: D) Automatic stabilizers work by increasing government spending and decreasing tax revenue to stimulate economic activity and support individuals and businesses during a recession or when the economy is producing less than potential GDP. . 9. Assume an economy is characterized by unemployment and/or underemployment of resources. The effect of reducing both of these problems will be to A) Move the level of actual output further away from the economy's current PP curve. B) Shift the economy's PP curve to the right. C) Move the level of actual output closer to the economy's current PP curve. D) Shift the economy's PP curve to the left. Show Answer Correct Answer: C) Move the level of actual output closer to the economy's current PP curve. 10. Bert just graduated college and is in the midst of applying for jobs. What type of unemployment is he experiencing? A) Frictional. B) Structural. C) Seasonal. D) Cyclical. Show Answer Correct Answer: A) Frictional. 11. When government spending increases, the aggregate demand curve A) Shifts to the left because private spending is being crowded out. B) Shifts to the right because more output is being demanded at every price level. C) Shifts to the right because a reduction in the price level causes the interest rate to be reduced and thereby stimulates spending. D) Shifts to the left because the higher level of government spending raises the interest rate and lowers total spending. Show Answer Correct Answer: B) Shifts to the right because more output is being demanded at every price level. 12. External sources of public debt are ..... A) Loans from the international money market. B) Borrowing from financial institutions. C) Loans from commercial bank. D) Loans from the central bank. Show Answer Correct Answer: A) Loans from the international money market. 13. Which would be least appropriate for expansionary FISCAL policy A) Increase taxes. B) Decrease taxes. C) Increase government spending. D) Combination of decreasing taxes and increasing spending. Show Answer Correct Answer: A) Increase taxes. 14. An increase in worker productivity? A) Increase in AD. B) Decrease in AD. C) Increased AS. D) Decrease in AS. Show Answer Correct Answer: C) Increased AS. 15. An important indicator of a nation's well-being is A) Gross Domestic Product (GDP). B) Gross National Product (GNP). C) Gross National income (GNI). D) The growth rate of GDP or GNP. Show Answer Correct Answer: A) Gross Domestic Product (GDP). 16. If borrowers and lenders agree on a nominal interest rate and inflation turns out to be less than they had expected, ..... A) Borrowers will gain at the expense of lenders. B) Lenders will gain at the expense of borrowers. C) Neither borrowers nor lenders will gain because the nominal interest rate has been fixed by contract. D) None of the answer choices are correct. Show Answer Correct Answer: B) Lenders will gain at the expense of borrowers. 17. A tax where people with higher income or wealth pay a larger rate than people with less income or wealth. The US Income Tax is an example. A) Fiscal policy. B) Monetary policy. C) Progressive tax. D) Proportional tax. E) Regressive tax. Show Answer Correct Answer: C) Progressive tax. 18. What is stagflation and how could it be corrected from the DA and OA model? A) Decrease in prices + Recession Technological changes, reduction in inflation expectations. B) Increase in prices + Growth Increase in public spending, reduction in inflation expectations. C) Price increases + RecessionTechnological changes, reduction in inflation expectations. D) Decrease in prices + Growth Increase in public spending, reduction in inflation expectations. E) Price increases + Recession Technological changes, increase in inflation expectations. Show Answer Correct Answer: C) Price increases + RecessionTechnological changes, reduction in inflation expectations. 19. Which of the following goods is included in GDP? A) Dresses. B) Screws used in a cruise missile. C) Flour for making bread. D) Cloth for making dresses. Show Answer Correct Answer: A) Dresses. 20. The national debt is equal to which of the following? A) The value of all government bonds held by the nation's central bank. B) The value of all loans in the nation's banking system. C) The current government budget deficit. D) The sum of all past government budget deficits and surpluses. Show Answer Correct Answer: D) The sum of all past government budget deficits and surpluses. ← 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