This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 12 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 12 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. How can the fed use the required reserve to increase the money supply? A) They can decrease the required reserve. B) The required reserve does not influence the supply of money. C) They can increase the required reserve. D) They can loan out the required reserve. Show Answer Correct Answer: A) They can decrease the required reserve. 2. What are the two tools of fiscal policy the federal government uses to influence the economy? A) Increasing or decreasing the reserve requirement or discount rate. B) Increasing or decreasing the reserve requirement or interest on reserves. C) Increasing or decreasing taxes and spending. D) Buying and selling bonds or increasing or decreasing the discount rate. Show Answer Correct Answer: C) Increasing or decreasing taxes and spending. 3. Per Capita Income is: A) All wrong. B) Income which views the value of economic output as the total value of compensation for production factors used in the production process. C) The average income of a country's residents at a given time. D) National income is calculated by adding up the production of goods and services for one year. E) The remaining deduction from costs or raw material prices is deducted from the selling price of the company's products. Show Answer Correct Answer: C) The average income of a country's residents at a given time. 4. Fiscal policy is the policy of ..... A) Central bank. B) Government. C) Commercial bank. D) All of these. Show Answer Correct Answer: B) Government. 5. ..... is the price paid for the use of money. A) The interest rate. B) Fiscal policy. C) Monetary policy. D) Gold. Show Answer Correct Answer: A) The interest rate. 6. Which is the largest item in the aggregate demand in the economy A) Consumption demand. B) Investment demand. C) Government demand. D) Net export demand. Show Answer Correct Answer: A) Consumption demand. 7. Okun's law indicates that for: A) A 5 percent GDP gap, a 1 percent increase in the natural unemployment rate is generated. B) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 5 percent GDP gap is generated. C) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 2 percent GDP gap is generated. D) A 2 percent GDP gap, a 2 percent increase in the actual unemployment rate is generated. Show Answer Correct Answer: C) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 2 percent GDP gap is generated. 8. The first coins were made of ..... A) Cheese. B) Jade. C) Gold. D) Bone. Show Answer Correct Answer: C) Gold. 9. The production of which type of product has to be financed by taxation? A) Those that are unprofitable. B) Those that are both non rival and non excludable. C) Those that have higher social costs than private costs. D) Those that are luxury items. Show Answer Correct Answer: B) Those that are both non rival and non excludable. 10. " Free to Choose" is best characterized as an example of what type of economics A) Normative; the destructive nature of much market activity, and how more government intervention is needed to correct the excess and abuses of the market system. B) Normative; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. C) Positive; the destructive nature of much market activity, and how more government intervention is needed to correct the excess and abuses of the market system. D) Positive; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. Show Answer Correct Answer: B) Normative; the beneficial role played by markets in society, and how excessive government intervention in the economy reduces personal freedom. 11. Refers to government revenue, spending, and debtFiscal A) Fractional Reserve Banking. B) Legal Reserves. C) Fiscal. D) Reserve system. Show Answer Correct Answer: C) Fiscal. 12. Defined as the percentage of the total number of people in the labor force who are unemployed A) CPI. B) Aggregate Supply. C) Inflation Rate. D) Underemployment Rate. Show Answer Correct Answer: D) Underemployment Rate. 13. When producers offer fewer products for sale at the same prices A) The price per unit has decrease. B) They expect subsidies. C) Supply curve shifts left. D) Supply curve shifts right. Show Answer Correct Answer: C) Supply curve shifts left. 14. Which causes United States GDP to increase? A) The United States buys more Japanese goods. B) The United States sells more goods to Japan. C) Japan sells Japanese securities to the U.S. D) Japan buys government securities. Show Answer Correct Answer: B) The United States sells more goods to Japan. 15. Your Mail lady is an example of ..... A) Land. B) Labor. C) Entrepreneurs. D) Capital. Show Answer Correct Answer: B) Labor. 16. A political system headed by a dictator that calls for extreme nationalism and racism and no tolerance of opposition A) Communism. B) Mean. C) Fascism. D) Socialism. Show Answer Correct Answer: C) Fascism. 17. Imagine you are the President. You want to influence the economy by adjusting government spending and revenue collection. What is this strategy called? A) Monetary Policy. B) Congressional Policy. C) Executive Policy. D) Fiscal Policy. Show Answer Correct Answer: D) Fiscal Policy. 18. Suppose there are two economies, Xenon and Yantel, which have the same PP curves and are currently at the same point on their respective curve. If Xenon then decides to devote more resources to capital goods production relative to consumer goods production compared to Yantel, then we would most likely expect: A) Xenon to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Yantel. B) Yantel to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Xenon. C) Yantel to increase its current production of consumer goods and, as a result, its current PP curve to shift inward (to the left). D) There would be no shift in the current or future PP curve for either Xenon or Yantel; there would only be a difference in the current composition of national output between consumer and capital goods. Show Answer Correct Answer: A) Xenon to realize a greater shift outward (to the right) in its future PP curve compared to the shift for Yantel. 19. Petroleum income tax and stamp duties are two examples of the government revenues. These revenues fall under which category? A) Non-revenue receipts. B) Non-tax revenue. C) Direct taxes. D) Indirect tax. Show Answer Correct Answer: C) Direct taxes. 20. The law of Demand states ..... A) The lower the price, the less producers will make. B) The lower the price, the more consumers will buy. C) That the higher the price, the more producers will make. D) The higher the price, the more consumers will buy. Show Answer Correct Answer: B) The lower the price, the more consumers will buy. 21. Government deficit A) A government is taxing more than spending. B) A government is spending more than taxing. Show Answer Correct Answer: B) A government is spending more than taxing. 22. Assume the government of Hamsterville increases taxation and reduces government spending. These actions cause a fall in total spending in the economy.Which of the following is the best description of the type of unemployment the fall in output will have? A) Natural Rate of Unemployment. B) Cyclical unemployment. C) Structural unemployment. D) Frictional unemployment. Show Answer Correct Answer: B) Cyclical unemployment. 23. The Government electrical center is the macroeconomics A) False. B) True. Show Answer Correct Answer: B) True. 24. What is the study of the behavior and decision making of entire economies called? A) Business Cycle. B) Gross Domestic Product (GDP). C) Macroeconomics. D) Microeconomics. Show Answer Correct Answer: C) Macroeconomics. 25. Mallory decides to spend 3 hours working overtime rather than watching a video with her friends. She earns $ 8 an hour for each hour of overtime she works. Her opportunity cost of working is: A) Nothing, since she would have received less than $ 24 of enjoyment from the video. B) The enjoyment she would have received had she watched the video. C) The $ 24 she earns working. D) The $ 24 minus the enjoyment she would have received from watching the video. Show Answer Correct Answer: B) The enjoyment she would have received had she watched the video. 26. How is the Federal Reserve more insulated from politics than other government agencies? A) The Federal Reserve operates independently of the government. B) Unlike other agencies, the Federal Reserve is publicly owned. C) Driven by profit, the Federal Reserve always acts in its own best interest. D) Leaders of the Federal Reserve are appointed to their positions for life. Show Answer Correct Answer: A) The Federal Reserve operates independently of the government. 27. Countries ..... with each other for a variety of reasons; like selling the excess products they have ..... A) Negotiate. B) Trade. C) Demands. D) Create Loans. Show Answer Correct Answer: B) Trade. 28. Fiscal policy, or making laws to alter government spending or change the tax rate to influence the economy, is controlled by who? A) Congress and the President. B) The Federal Reserve. C) IRS. D) Treasury Department. Show Answer Correct Answer: A) Congress and the President. 29. The annual statement of outlays, tax revenues, and surplus and/or deficit of the United States government is called the ..... A) Federal spending plan. B) US deficit record. C) Federal spending. D) Federal budget. Show Answer Correct Answer: D) Federal budget. 30. The nominal GDP is the sum of Consumer Spending, Investment Spending, Government Spending, and Net Exports (C+I+G+(X-M)). REAL GDP is this sum A) Minus profits. B) Plus profits. C) Rarely used. D) Adjusted for inflation. Show Answer Correct Answer: D) Adjusted for inflation. ← 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