This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 78 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 78 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is not an addition to national income? A) Wages. B) Salaries. C) Interest. D) Depreciation. E) Profits. Show Answer Correct Answer: D) Depreciation. 2. An increase in government purchases will increase aggregate demand because A) The decline in the interest rate will increase demand. B) Government expenditures are a component of aggregate demand. C) Consumption expenditures are a component of aggregate demand. D) The decline in the price level will increase demand. Show Answer Correct Answer: B) Government expenditures are a component of aggregate demand. 3. How are the 7 Board of Governors put in power? A) The people vote upon each member. B) They are all appointed by the Senate. C) They are all appointed by the President and confirmed by the Senate. D) The people vote for only the chairman and he appoints his team. Show Answer Correct Answer: C) They are all appointed by the President and confirmed by the Senate. 4. A period of very low inflation would MOST likely lead to A) Higher tuition costs. B) Lower prices on books. C) More demand for college degrees. D) Less demand for skilled workers. Show Answer Correct Answer: B) Lower prices on books. 5. The relationship between speculative demand form money and interest is A) Directly proportional. B) Inverse. C) No relationship. D) Bi-directional and positive. Show Answer Correct Answer: B) Inverse. 6. Price where quantity supplied equals quantity demanded. A) Equilibrium price. B) Equilibrium quantity. C) Price floor. D) Price. Show Answer Correct Answer: A) Equilibrium price. 7. Equitable distribution of income is one of the problems of macroeconomics goal. A) TRUE. B) FALSE. Show Answer Correct Answer: B) FALSE. 8. How do interest rates impact MPS and MPC A) They change cost of borrowing for firms, this changes the amount banks have to have in their deposits. B) They change returns on savings. This changes incentive to save, and therefore how much households are willing to spend on consumption (MPC). C) They only impact MPS and not MPC, because they change incentive to save. D) They dont impact either, they only impact cost of loans. Show Answer Correct Answer: B) They change returns on savings. This changes incentive to save, and therefore how much households are willing to spend on consumption (MPC). 9. What are Porter's 5 Forces used for? A) Stock analysis. B) Industry analysis. C) Price analysis. D) Consumer analysis. Show Answer Correct Answer: B) Industry analysis. 10. The Federal Reserve has three primary goals. What does it mean to control inflation? A) To maintain stable prices. B) To ensure maximum employment. C) To increase production output. D) None of above. Show Answer Correct Answer: A) To maintain stable prices. 11. No tangible backing, but it is declared by the government that issues it, and accepted by citizens who use it, to have worth. A) Fiat Money. B) Representative Money. C) Commodity Money. D) Gold Standard. Show Answer Correct Answer: A) Fiat Money. 12. GDP stands for A) Gross Display of Power. B) Great Development of Products. C) Gross Domestic Product. D) Good Domestic Partners. Show Answer Correct Answer: C) Gross Domestic Product. 13. Which of the following occurs in a given year when a country's government runs a budget deficit? A) Debt owed to foreigners exceeds the debt owed to the country's citizens. B) Amount borrowed exceeds interest payment on the national debt. C) Tax revenues exceeds government spending. D) Government spending exceeds tax revenues. Show Answer Correct Answer: D) Government spending exceeds tax revenues. 14. Nominal interest rate-expected rate of price inflation A) Nominal interest rate. B) Real interest rate. C) Real GDP. D) Nominal GDP. Show Answer Correct Answer: B) Real interest rate. 15. The BNM can increase the money supply by conducting open market A) Sales and raising the discount rate. B) Sales and lowering the discount rate. C) Purchases and raising the discount rate. D) Purchases and lowering the discount rate. Show Answer Correct Answer: D) Purchases and lowering the discount rate. 16. Inflation causes exports to be more competitive A) True. B) False. Show Answer Correct Answer: A) True. 17. What are the automatic stabilisers in the economy? A) Fiscal policy Taxes Benefits. B) Budget DeficitTaxesTransfer Payments. C) TaxesBenefits. D) All correct. Show Answer Correct Answer: B) Budget DeficitTaxesTransfer Payments. 18. Adam Smith's Concept that individuals self-interested behavior can lead to positive social outcomes (Normative Statement ) A) The Art and Science of Respect. B) Think and Grow Rich. C) Rich Dad Poor Dad. D) Invisible hand. Show Answer Correct Answer: D) Invisible hand. 19. What should the company do when MPL > W/P? A) Firm should hire less L. B) Firm should hire the right amount of L. C) Firm should hire more L. D) Firm should not hire L. Show Answer Correct Answer: C) Firm should hire more L. 20. A four-sector economy is called ..... A) Injection. B) Open economy. C) Simple economy. D) Closed economy. Show Answer Correct Answer: B) Open economy. ← 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