This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 117 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 117 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. When businesses earn more revenue than the amount of money they spent as a business, it is called ..... A) Profit. B) Debt. C) Operating costs. D) Fraud. Show Answer Correct Answer: A) Profit. 2. Required capital for economy eq A) $\Delta k=sf\left(k\right)-\delta k$. B) $\Delta k=\delta k-sf\left(k\right)$. C) $\Delta sf\left(k\right)=k-\delta k$. D) $\Delta k=sf\left(k\right)+\delta k$. Show Answer Correct Answer: A) $\Delta k=sf\left(k\right)-\delta k$. 3. If the required reserve ratio is 25 percent, the simple deposit multiplier is A) 8.0. B) 2.5. C) 4.0. D) 5.0. Show Answer Correct Answer: C) 4.0. 4. When the Federal Reserve sells government securities on the open market, what effect does this action have on the nation's money supply and interest rates? A) Money Supply-Increases / Interest Rates-Decrease. B) Money Supply-Decreases / Interest Rates-Increase. C) Money Supply-Decreases / Interest Rates-Decrease. D) Money Supply-Increases / Interest Rates-Increase. Show Answer Correct Answer: B) Money Supply-Decreases / Interest Rates-Increase. 5. This classification includes all of M1 as well as savings depositis, money market deposits, and money market mutual funds. A) M1. B) M2. C) M3. D) None of above. Show Answer Correct Answer: B) M2. 6. What is the primary cause of deflation according to monetarist theory? A) A rapidly changing velocity of money. B) The money supply decreases faster than real output decreases. C) Any decrease in the money supply. D) A stable quantity velocity of money. E) The money supply increases too rapidly for a long time. Show Answer Correct Answer: B) The money supply decreases faster than real output decreases. 7. Sue drinks three sodas during a particular day. The marginal benefit she enjoys from drinking the third soda A) Can be thought of as a total benefits you enjoyed by drinking three sodas minus the total benefit she would have enjoyed by drinking just two sodas. B) Determine Sue's willingness to pay for the third soda. C) Is likely different from the marginal benefit provided to sue by the second soda. D) Is likely to continue to fall as Sue drinks more and more soda. E) All of the above are correct. Show Answer Correct Answer: E) All of the above are correct. 8. Goods that are produced by one firm for use in furtherprocessing by another firm. A) Intermediate goods. B) Final goods. C) Gross domestic products. D) Fin. Show Answer Correct Answer: A) Intermediate goods. 9. Choose the Best Answer.What specific type of inflation is caused by a sudden decline in the supply of goods in the economy? A) Profit-push. B) Supply shock. C) Rent-push. D) Wage-push. Show Answer Correct Answer: B) Supply shock. 10. An appropriate fiscal policy to tackle sever inflation is ..... A) An increase in government spending. B) Depreciation of the currency. C) A tax rate increase. D) A reduction in interest rate. Show Answer Correct Answer: C) A tax rate increase. 11. If real gross domestic product is increasing at 3 percent per year and nominal gross domestic product is increasing at 7 percent per year, which of the following is necessarily true? A) The government is running a budget deficit. B) The price level is increasing. C) Unemployment is increasing. D) Exports exceed imports. E) The economy is in a recession. Show Answer Correct Answer: B) The price level is increasing. 12. A headline in the New York Times reads: "Thousands of U. S. auto makers lose jobs to workers in Mexico." After reading it you realize this story is a perfect example of ..... unemployment. A) Seasonal. B) Frictional. C) Structural. D) Cyclical. Show Answer Correct Answer: C) Structural. 13. Supporters of Keynesian economics believe that A) Government should be used as a tool to increase demand for goods. B) Demand for goods increases when prices rise. C) Taxes have a strong negative influence on economic output. D) The government should have a limited role in regulating the economy. Show Answer Correct Answer: A) Government should be used as a tool to increase demand for goods. 14. Measure of the overall level of prices in the economy A) Budget. B) Contractionary Fiscal Policy. C) CPI. D) Price Level. Show Answer Correct Answer: D) Price Level. 15. Lowering the tax rate is an example of ..... A) Contractionary monetary policy. B) Contractionary fiscal policy. C) Expansionary fiscal policy. D) Expansionary monetary policy. Show Answer Correct Answer: C) Expansionary fiscal policy. 16. What phase of the business cycle comes before a contraction? A) Peak. B) Expansion. C) Recovery. D) Trough. Show Answer Correct Answer: A) Peak. 17. The intersection of the aggregate demand and aggregate supply curve occurs at the economy's equilibrium level of A) Nominal investment and the interest rate. B) Government taxes and employment. C) Real disposable income and unemployment. D) Real domestic output and the price level. Show Answer Correct Answer: D) Real domestic output and the price level. 18. Paper money is included in ..... [Wang kertas termasuk dalam ..... ] A) M1, and M2 only [M1 dan M2 sahaja]. B) M1, M2 and M3 [M1, M2, dan M3]. C) M1 only [M1 sahaja]. D) M2 only [M2 sahaja]. Show Answer Correct Answer: B) M1, M2 and M3 [M1, M2, dan M3]. 19. On the business cycle, the lowest point in an economic recession is called A) Peak. B) Trough. C) Expansion. D) Contraction. Show Answer Correct Answer: B) Trough. 20. Inflationary Gap A) Output is low and unemployment is more than NRU. Actual GDP is below potential GDP. B) Laws that reduce inflation, decrease GDP (Close an Inflationary Gap)-G or + taxes (-C). C) Output is high and unemployment is less than NRU. Actual GDP is above potential GDP. D) A gap with higher prices and a decrease in GDP. E) Laws that reduce unemployment and increase GDP (Close a Recessionary Gap) + G or-taxes (+C). Show Answer Correct Answer: C) Output is high and unemployment is less than NRU. Actual GDP is above potential GDP. 21. What is meant by the term 'hyperinflation'? A) The rise in GDP following the end of a recession. B) A continuous general rise in prices. C) A general fall in prices. D) Very high levels of inflation. Show Answer Correct Answer: D) Very high levels of inflation. 22. The basic economic problem of all countries is the existence of A) Tax increases and budget deficits. B) Limited resources and unlimited wants. C) Unemployment and inflation. D) Government and private industry. E) Unions and monopoly firms. Show Answer Correct Answer: B) Limited resources and unlimited wants. 23. A market where economic decisions are made by the government A) Free market. B) Open market. C) Command market. D) Flea market. Show Answer Correct Answer: C) Command market. 24. Assuming Ramen is an inferior good, a decrease in income will shift the: A) Supply curve for Ramen to the left. B) Supply curve for Ramen to the right. C) Demand curve for ramen to the right. D) Demand curve for ramen to the left. E) There is no shift. Show Answer Correct Answer: C) Demand curve for ramen to the right. 25. According to the Laffer curve, decreasing tax rates A) On income will always increase tax revenues. B) Are more likely to increase tax revenues the lower tax rates are to start with. C) On income will always decrease tax revenues. D) Are more likely to increase tax revenues the higher tax rates to start with. Show Answer Correct Answer: D) Are more likely to increase tax revenues the higher tax rates to start with. 26. Comprehensive social security system encourage people on A) Future consumption. B) Current consumption. C) Saving for future. D) None of above. Show Answer Correct Answer: B) Current consumption. 27. Macroeconomics is concerned with: A) The level of output of goods and services in the economy. B) The general level of prices. C) GDP growth. D) All of these. Show Answer Correct Answer: D) All of these. 28. The unemployment rate excludes people who are not part of what? A) Society. B) Economics. C) The Labor Force. D) The population. Show Answer Correct Answer: C) The Labor Force. 29. The table below shows the cost of the same representative basket of goods in the base year 2012 and in 2013, and the average weekly nominal wage rate in 2012 and 2013 ..... 2012 ..... 2013Cost of a given basket of goods|$ 10, 000 | $ 12, 000Average weekly nominal wage | $ 1, 000 | $ 1, 100 If 2012 is the base year, which of the following is true? A) The CPI in year 2013 is 110. B) The CPI in year 2013 is 120. C) Based on the CPI, the average real weekly wage rate increased by 10% from 2012 to 2013. D) Based on the CPI, the average real weekly wage rate decreased by 20% from 2012 to 2013. E) The inflation rate from 2012 to 2013 is 10%. Show Answer Correct Answer: B) The CPI in year 2013 is 120. 30. Quantity Theory of Money A) MV=PT. B) I = r + phi. C) M/P = L(i, Y). D) M/P=kY. Show Answer Correct Answer: A) MV=PT. ← PreviousNext →Related QuizzesEconomics QuizzesFinance QuizzesMacroeconomics Quiz 1Macroeconomics Quiz 2Macroeconomics Quiz 3Macroeconomics Quiz 4Macroeconomics Quiz 5Macroeconomics Quiz 6Macroeconomics Quiz 7Macroeconomics Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books