This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Macroeconomics – Quiz 83 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 83 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Expansionary fiscal policy abroad A) Raises world interest rate. B) Decreases world interest rate. C) Reduces saving. D) Increases investment. Show Answer Correct Answer: A) Raises world interest rate. 2. The ..... on a project is the profit earned on the project expressed as a percentage of its cost. A) Rate of Return. B) Crowding Out. C) Long-Term Interest Rates. D) Short-Term Interest Rates. Show Answer Correct Answer: A) Rate of Return. 3. Decrease in ..... causes investment spending to rise which shifts aggregate demand curve up and raises the income level. A) Saving. B) Interest rate. C) Income. D) Production. Show Answer Correct Answer: B) Interest rate. 4. GDP = C + I + G + (X-M) In this model, the "(X-M)" represents the A) Total of the dollar value of goods sent abroad and goods purchased from abroad. B) Difference between the dollar value of goods sent abroad and goods purchased from abroad. C) Total investments in the United States by foreign nationals. D) Total investments in other nations by US citizens. Show Answer Correct Answer: B) Difference between the dollar value of goods sent abroad and goods purchased from abroad. 5. This is the use of government policy to reduce the severity of recessions and rein in excessively strong expansions. A) Stabilization Policy. B) Contractionary Fiscal Policy. C) Expansionary Fiscal Policy. D) None of above. Show Answer Correct Answer: A) Stabilization Policy. 6. An increase in the price level within a country will lead to which of the following scenarios? A) A rightward shift in both of the curves. B) A rightward shift in the SRAS curve and a leftward shift in the AD curve. C) An increase in quantity supplied and a decrease in quantity demanded. D) A negative supply shock. Show Answer Correct Answer: C) An increase in quantity supplied and a decrease in quantity demanded. 7. The economic indicator that measures the changes in the costs of a "basket" of goods and services typically purchased by consumers. A) Real GDP. B) GDP. C) Consumer Cost Index. D) Consumer Price Index. Show Answer Correct Answer: D) Consumer Price Index. 8. Which of the following best describes "a state of economic hardship characterized by high levels of unemployment and a decline in manufacturing and income over a long period of time" ? A) Recession. B) Depression. C) Inflation. D) Deflation. Show Answer Correct Answer: B) Depression. 9. The rate of inflation will fall if A) Aggregate demand stays constant and productivity increases. B) Aggregate supply falls. C) Aggregate supply is constant. D) Aggregate demand is constant and factor costs rise. Show Answer Correct Answer: A) Aggregate demand stays constant and productivity increases. 10. The sale of U.S. treasury bonds on the open market will cause a(n) ..... in the U.S. price level and a(n) ..... of the U.S. dollar in the foreign exchange market. A) Decrease, appreciation. B) Decrease, depreciation. C) Increase, appreciation. D) Increase, depreciation. Show Answer Correct Answer: A) Decrease, appreciation. 11. India has a higher productivity than the United States because they have more people. A) True. B) False. Show Answer Correct Answer: B) False. 12. If the Federal Reserve wants to increase the amount of money in circulation then they should ..... A) Lower the reserve requirement. B) Sell bonds. C) Raise the reserve requirement. D) Raise the discount rate. Show Answer Correct Answer: A) Lower the reserve requirement. 13. What can the government do to slow the economy down? A) Lower taxes. B) Raise taxes. C) Spend more. D) Spend less. Show Answer Correct Answer: B) Raise taxes. 14. Macroeconomics is the study of " ..... " economics. A) Worldwide. B) Trickle-down. C) Large-scale. D) Personal. Show Answer Correct Answer: C) Large-scale. 15. If the marginal propensity to consume is 0.75, an initial increase in aggregate spending of $ 1, 000 will lead to a total change in real GDP equal to A) $ 750. B) $ 1, 000. C) $ 4, 000. D) $ 7, 500. Show Answer Correct Answer: C) $ 4, 000. 16. If nation A has an absolute advantage over nation B in the production of a product, this implies that: A) It requires fewer resources in A to produce the good than in B. B) The cost of producing the good in terms of some other good's production that must be sacrificed is lower in A than in B. C) Nation B could not benefit by engaging in trade with A. D) Nation A should acquire this product by trading with B. Show Answer Correct Answer: A) It requires fewer resources in A to produce the good than in B. 17. The labor union that only accepted skilled workers who were difficult to replace during strikes. A) Knights of Labor. B) American Federation of Labor. C) World Wide Federation of Labor. D) Nights and Days of Labor. Show Answer Correct Answer: B) American Federation of Labor. 18. Labor refers to ..... A) People with all their efforts and abilities. B) Individuals who start a new business or bring a product to market. C) The tools, equipment, and factories used in production of goods and services. D) The "gifts of nature" or natural resources not created by human effort. Show Answer Correct Answer: A) People with all their efforts and abilities. 19. In the former Soviet Union, producers were paid for meeting output targets, not for selling products. Under those circumstances, what were the economic incentives for producers? A) To produce good quality products so that society would benefit from the resources used. B) To conserve on costs, so as to maintain efficiency in the economy. C) To produce enough to meet the output target, without regard for quality or cost. D) To produce those goods that society desires most. Show Answer Correct Answer: C) To produce enough to meet the output target, without regard for quality or cost. 20. In the mid-to late 1980s, Australia had large foreign debt. The concerns were about: A) The ability of the country to make payments in case of an economic downturn. The equity investments were suggested. B) The coming economic boom and the ability of the country to pay economic dividends. C) The accessibility of local capital for foreign companies to partially cover the debt. D) The liabilities were only 2% of the GDP and needed to be brought up to at least 25%. Show Answer Correct Answer: A) The ability of the country to make payments in case of an economic downturn. The equity investments were suggested. ← 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