This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 55 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 55 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which statement BEST describes monetary and fiscal policy? A) Monetary policy reflects the Federal Reserve's authority to change the money supply; fiscal policy reflects the government's power to influence the economy through taxes, expenditures, and borrowing. B) Monetary policy reflects the Federal Reserve's authority to change tax rates; fiscal policy reflects the government's power to influence the money supply by lowering the discount rate for loans to banks. C) Monetary policy refers to the Federal Reserve's influence in the economy through borrowing and creating a deficit; fiscal policy refers to the government's authority to increase spending. D) Monetary policy refers to the Federal Reserve's authority to increase spending; fiscal policy refers to the government's authority to increase the discount rate for loans to banks. Show Answer Correct Answer: A) Monetary policy reflects the Federal Reserve's authority to change the money supply; fiscal policy reflects the government's power to influence the economy through taxes, expenditures, and borrowing. 2. These are taxing and spending policies by a government. A) Fiscal policy. B) Monetary policy. C) Progressive tax. D) Proportional tax. E) Regressive tax. Show Answer Correct Answer: A) Fiscal policy. 3. Types of Capital A) Human and physical. B) Total satisfaction or benefit from consuming a good or service. C) An increase in demand with no change in supply. D) A curve that shows the relationship between the price of a product and the quantity of the product supplied. Show Answer Correct Answer: A) Human and physical. 4. What is the Old-Age, Survivors, and Disability Insurance (OASDI) program called in the United States? A) Social Security. B) Medicare. C) Disability Insurance. D) Provident Fund. Show Answer Correct Answer: A) Social Security. 5. Which of these is not true of a structural deficit? A) A structural deficit is the result of an economic downturn. B) Governmental entities are responsible for structural deficits. C) Structural deficits can be reduced through discretionary fiscal policy. D) Structural deficits may be caused by fiscal stimuli such as tax cuts. E) More than one of the above statements is not true. Show Answer Correct Answer: A) A structural deficit is the result of an economic downturn. 6. How does the Federal Reserve achieve its primary goals? A) Helping to develop the taxation policies. B) Raising and lowering the minimum wage. C) Raising and lowering short-term interest rates. D) Increasing and decreasing government spending. Show Answer Correct Answer: C) Raising and lowering short-term interest rates. 7. What is fiscal policy? A) Fiscal policy is the use of government regulations to control inflation. B) Fiscal policy is the use of government spending and taxation to influence the economy. C) Fiscal policy is the use of government subsidies to control unemployment. D) Fiscal policy is the use of government spending to control interest rates. Show Answer Correct Answer: B) Fiscal policy is the use of government spending and taxation to influence the economy. 8. When the Japanese car maker Toyota expands one of its car factories in the United States, what is the likely impact of this event on the gross domestic product and gross national product of the United States? A) GDP rises and GNP falls. B) GNP rises and GDP falls. C) GDP and GNP both rise but GDP rises by more. D) GDP and GNP both rise but GNP rises by more. Show Answer Correct Answer: C) GDP and GNP both rise but GDP rises by more. 9. Which of the following policies would most likely be recommended in an economy with an annual inflation rate of 3 percent and an unemployment rate of 11 percent? A) An increase in transfer payments and an increase in the reserve requirement. B) An increase in defense spending and an increase in the discount rate. C) An increase in income tax rates and a decrease in the reserve requirement. D) A decrease in government spending and the open market sale of government securities. E) A decrease in the tax rate on corporate profits and a decrease in the discount rate. Show Answer Correct Answer: E) A decrease in the tax rate on corporate profits and a decrease in the discount rate. 10. Suppose after graduating from college you get a job working at a bank earning $ 30, 000 per year. After two years of working at the bank earning the same salary, you have an opportunity to enroll in a one-year graduate program that would require you to quit your job at the bank. Which of the following should NOT be included in a calculation of your opportunity cost? A) The cost of tuition and books to attend the graduate program. B) The $ 30, 000 salary that you could have earned if you retained your job at the bank. C) The $ 45, 000 salary that you will be able to earn after having completed your graduate program. D) The value of insurance and other benefits you would have received if you kept your job at the bank. Show Answer Correct Answer: C) The $ 45, 000 salary that you will be able to earn after having completed your graduate program. 11. Equipment buildings land, etc A) Variable costs. B) Fixed costs. C) Producer surplus. D) Physical capital. Show Answer Correct Answer: D) Physical capital. 12. All of the following could be scarce resources:oil, labor, and food. A) True. B) False. Show Answer Correct Answer: A) True. 13. What will Loose money/easy money/expansionary monetary policy do to the money supply? A) Increase the money supply. B) Decrease the money supply. Show Answer Correct Answer: A) Increase the money supply. 14. If the exchange rate changes from 1 United States dollar = 100 yen to 1 United States dollar = 80 yen, which of the following will happen? A) United States goods will become more expensive to Japanese consumers. B) Japanese goods will become less expensive to United States consumers. C) United States exports to Japan will increase. D) Japanese exports to the United States will increase. E) Japanese imports from the United States will decrease. Show Answer Correct Answer: C) United States exports to Japan will increase. 15. Actions or activities that one person performs for another A) Exports. B) Favors. C) Imports. D) Services. Show Answer Correct Answer: D) Services. 16. Fiscal policy A) Affects income under fixed exchange rates but not under floating exchange rates. B) Affects income under floating exchange rates but not under fixed exchange rates. C) Affects income under fixed exchange rates and floating exchange rates. D) Affects neither income under fixed exchange rates or under floating exchange rates. Show Answer Correct Answer: A) Affects income under fixed exchange rates but not under floating exchange rates. 17. Goods or services produced in the United States and shipped to foriegn countries. A) Entitlements. B) Subsidies. C) Tariffs. D) Imports. E) Exports. Show Answer Correct Answer: E) Exports. 18. Competition and profit motive are important characteristics of a: A) Command economy. B) Traditional economy. C) Market economy. D) Socialist economy. Show Answer Correct Answer: C) Market economy. 19. Service-related jobs in such industries as banking, insurance, retail, education, and communications are part of the ..... Sector A) Primary. B) Secondary. C) Tertiary. D) Quaternary. Show Answer Correct Answer: C) Tertiary. 20. A change in taxes/government transfers would affect consumption how? A) The marginal propensity to save. B) Disposable income. C) Marginal propensity to consume. D) Demand of bonds. Show Answer Correct Answer: C) Marginal propensity to consume. ← 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