This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 46 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 46 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Who controls the Federal Reserve? A) The Board of Governors. B) The FOMC. C) The President. D) The Chairman. Show Answer Correct Answer: A) The Board of Governors. 2. What determines the level of real output in the long run? A) Temporary economic changes. B) Short-term supply shocks. C) The economy being at full capacity. D) The current inflation rate. Show Answer Correct Answer: C) The economy being at full capacity. 3. When prices rise for a particular product, consumers will purchase lower-priced similar items ..... A) Income effect. B) Substitute effect. C) Diminishing marginal utility. D) Law of demand. Show Answer Correct Answer: B) Substitute effect. 4. Which of the following is an advantage of sole proprietorship? A) There are almost no requirements to start up a sole proprietorship. B) The owner keeps all the profits. C) The owner makes all the decisions. D) All of the above statements are true. Show Answer Correct Answer: D) All of the above statements are true. 5. An economy that interacts with other economies is known as A) A balanced trade economy. B) An export economy. C) A closed economy. D) An open economy. Show Answer Correct Answer: D) An open economy. 6. What happens to IS curve if government reduces tax rate? A) IS curve shifts to the left. B) IS curve shifts to the right. C) IS curve becomes vertical. D) IS curve becomes horizontal. Show Answer Correct Answer: B) IS curve shifts to the right. 7. What does a Gini Coefficient show? A) The number of millionaires in a country. B) The level of inequality in a society. C) The amount of unemployment. D) The need for Government to increase taxes. Show Answer Correct Answer: B) The level of inequality in a society. 8. The following objective is not one of the macroeconomic objectives: A) Reduce unemployment. B) Reduce social costs of pollution. C) Keep prices low and stable. D) Achieve higher GDP every year. Show Answer Correct Answer: B) Reduce social costs of pollution. 9. Economic term to describe conditions where there are not enough resources to produce what is demanded A) Affluence. B) Scarcity. C) Overproduction. D) Elasticity. Show Answer Correct Answer: B) Scarcity. 10. Gross Domestic Product (GDP) A) The value of all final goods and services produced within a nation in a year. B) National income minus outputs. C) The value of all prices. D) The value of intermediate products. Show Answer Correct Answer: A) The value of all final goods and services produced within a nation in a year. 11. Minimizing increases in the price level over time so that a country's money will retain its purchasing power over time. A) Economic Growth. B) Price Stability. C) Full Employment. D) None of above. Show Answer Correct Answer: B) Price Stability. 12. The percentage of a deposit that a bank must hold on to is called the ..... A) Reserve Requirement. B) Discount Rate. C) Credit. D) None of above. Show Answer Correct Answer: A) Reserve Requirement. 13. What is the most common outcome of a US federal budget? A) Balanced Budget. B) Budget Surplus. C) Budget Deficit. D) None of above. Show Answer Correct Answer: C) Budget Deficit. 14. Using the spending approach, which one of the following economic agents is responsible for the largest component of the gross domestic product of the Euro Area? A) Businesses. B) The rest of the world sector. C) Agents involved with illegal activities. D) Private households and institutions. E) Member countries' governments. Show Answer Correct Answer: D) Private households and institutions. 15. Which of the following will occur if the federal government runs a budget deficit? A) Expenditure multiplier will increase. B) Size of the national debt will increase. C) Economy's output will decrease. D) State governments will run a budget surplus to offset the federal deficit. E) Interest rates will tendd to decline. Show Answer Correct Answer: B) Size of the national debt will increase. 16. What is the Federal Funds Rate? A) The amount of money the government gives to schools. B) Loan interest Rates. C) The amount of money the government collects in taxes. D) The Interest rate in which depository institutions lend reserve balances to other depository institutions overnight. Show Answer Correct Answer: D) The Interest rate in which depository institutions lend reserve balances to other depository institutions overnight. 17. A business with one owner who has total control and liability is ..... A) Partnership. B) Monopoly. C) Corporation. D) Sole proprietorship. Show Answer Correct Answer: D) Sole proprietorship. 18. All other things being equal, in the short run, a decrease in aggregate demand in an economy is most likely to result in a reduction in A) Government spending on welfare benefits. B) The unemployment rate. C) The budget deficit. D) The balance of payments deficit on the current account. Show Answer Correct Answer: D) The balance of payments deficit on the current account. 19. Fill in the blanks:GDP is the ..... value of all ..... goods and services produced within a country in a year. A) Market, final. B) Production, saleable. C) Input, intermediate. D) Dollar, exportable. Show Answer Correct Answer: A) Market, final. 20. What problems are we most likely to see at which stage of the business cycle? A) High inflation during recessions. B) High unemployment during booms. C) Low inflation during booms. D) High unemployment during recessions. Show Answer Correct Answer: D) High unemployment during recessions. ← 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