This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 128 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 128 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. According to the analysis of the British economist John Maynard Keynes A) Markets coordinate supply and demand so that a policy of laissez-faire would prevent recession. B) Economic fluctuations were the cumulative result of mistakes made by businesses and households in an uncertain world. C) Government demand could be used to smooth fluctuations in aggregate output and income. D) Supply creates its own demand through the circular flow of economic activity. Show Answer Correct Answer: C) Government demand could be used to smooth fluctuations in aggregate output and income. 2. TRUE or FALSE:The largest component of the manufactured capital stock in Europe is inventories. A) TRUE. B) FALSE. Show Answer Correct Answer: B) FALSE. 3. What is the Federal Open Market Committee (FOMC)? A) The monetary policy making body of the Federal Reserve System. B) The committee that determines the federal funds rate. C) The committee that oversees government budget deficits. D) The legislative body responsible for passing fiscal policies. Show Answer Correct Answer: A) The monetary policy making body of the Federal Reserve System. 4. If exports are to be increased then the currency of a country should be A) No change. B) Appreciated or depreciated. C) Depreciated. D) Appreciated. Show Answer Correct Answer: C) Depreciated. 5. Economics is the study of how to allocate resources A) True. B) False. Show Answer Correct Answer: A) True. 6. Gross Domestic Product (GDP) is A) A measure of all goods and services produced by a country. B) Import vs. export exchange rates. C) The volume of disgusting products produced by a national economy. D) The volume of grain, meat, and vegetables that a nation exports. Show Answer Correct Answer: A) A measure of all goods and services produced by a country. 7. Why does contractionary monetary policy cause interest rates to rise? A) Contractionary monetary policy increases the money supply, leading to higher demand for the remaining funds, which in turn causes interest rates to rise. B) Contractionary monetary policy reduces the money supply, leading to higher demand for the remaining funds, which in turn causes interest rates to rise. C) Contractionary monetary policy has no impact on the money supply, so interest rates remain unchanged. D) Contractionary monetary policy reduces the money supply, leading to lower demand for the remaining funds, which in turn causes interest rates to rise. Show Answer Correct Answer: B) Contractionary monetary policy reduces the money supply, leading to higher demand for the remaining funds, which in turn causes interest rates to rise. 8. All the following are monetary policy instruments, except ..... A) Government expenditure. B) Open market operations. C) Funding. D) Legal cash reserve requirements. Show Answer Correct Answer: A) Government expenditure. 9. Explaining the effect of higher wage rates on a company's supply decision A) Microeconomic. B) Macroeconomics. Show Answer Correct Answer: A) Microeconomic. 10. What type of income is earned by pulling rickshaw to a rickshaw puller? A) Transfer income. B) Windfall gains. C) Factor income. D) All of the above. Show Answer Correct Answer: C) Factor income. 11. If real gross domestic product is declining, the economy is most likely experiencing which of the following? A) Increasing unemployment. B) Negative long-run economic growth. C) Inflationary pressures. D) An increase in aggregate demand. E) A recovery. Show Answer Correct Answer: A) Increasing unemployment. 12. Imagine you are the head of the Federal Reserve System. You need to take certain actions to influence the level of real GDP and the rate of inflation in the economy. What kind of policy would you use? A) Congressional Policy. B) Fiscal Policy. C) Monetary Policy. D) Executive Policy. Show Answer Correct Answer: C) Monetary Policy. 13. Economic system that has characteristics of both a market and command economy A) Market. B) Command. C) Traditional. D) Mixed. Show Answer Correct Answer: D) Mixed. 14. The nominal exchange rate shows how much one country's currency can be exchanged for another country's currency. A) True. B) Lie. Show Answer Correct Answer: A) True. 15. A measure of the average price of a specified set of goods and services purchased by typical consumers A) Economic Growth. B) Gross Domestic Product. C) Consumer Price Index. D) Unemployment Rate. Show Answer Correct Answer: C) Consumer Price Index. 16. Type of unemployment that occurs when people take time to find a job. A) Structural Unemployment. B) Frictional Unemployment. C) Cyclical Unemployment. D) Seasonal Unemployment. Show Answer Correct Answer: B) Frictional Unemployment. 17. Net capital formation causes: A) Increase in profits. B) Increase in production capacity. C) Increase in cost. D) Increase in depreciation. Show Answer Correct Answer: B) Increase in production capacity. 18. Choose the Best Answer.When he was interviewed for the Labor Force Survey, Manong Efraim had no work and was not looking for work due to his permanent disability. Given this, he falls in what labor category? A) Unemployed. B) Underemployed. C) Not part of the labor force. D) Employed. Show Answer Correct Answer: C) Not part of the labor force. 19. The branch of economies that examines the functioning of individual industries and the behavior of individual decision making units is ..... A) Normative economics. B) Positive economics. C) Microeconomics. D) Macroeconomics. Show Answer Correct Answer: C) Microeconomics. 20. Which is a characteristic of an economic expansion or the "Boom" the Business Cycle? A) Increase in unemployment. B) Decrease in unemployment. C) Decrease in production. D) Decrease in wages. Show Answer Correct Answer: B) Decrease in unemployment. 21. A change from 2$ =rs 140 to 1$ =rs 60 indicates that Rupee is A) Appreciating. B) Depreciating. C) None. D) Both. Show Answer Correct Answer: A) Appreciating. 22. Monetary Policy is the central bank attempts to ..... A) Control the amount of money in circulation. B) Control the central bank's debt. C) Control regional governments' spending. D) None of these answers are correct. Show Answer Correct Answer: A) Control the amount of money in circulation. 23. I got laid off during the Covid 19 pandemic due the company I worked for closing down as the economy took a downturn. This is an example of ..... unemployment A) Cyclical. B) Structural. C) Frictional. D) None of above. Show Answer Correct Answer: A) Cyclical. 24. S=-200 + 0.7 Yd based on saving function above, the consumption function is ..... A) C= 200+ 0.3Yd. B) C=500 + 0.3Yd. C) C=200+0.4Yd. D) C=-500+0.3Yd. Show Answer Correct Answer: A) C= 200+ 0.3Yd. 25. Who is considered frictionally unemployed? A) People who are unemployed due to a recession. B) People who do not have the right skills. C) People who have given up looking for work. D) People who are between jobs. Show Answer Correct Answer: D) People who are between jobs. 26. TRUE or FALSE:Satellite accounts prohibit the measurement of natural capital in monetary terms. A) TRUE. B) FALSE. Show Answer Correct Answer: B) FALSE. 27. Compulsory contribution by an individual or a firm to the government to be used in the common interest of economy refers to A) Non-revenue receipts. B) Fixed tax. C) Non tax revenue. D) Tax revenue. Show Answer Correct Answer: D) Tax revenue. 28. Billy gets charged tax every time he buys a new pair of shoes. What kind of tax is this? A) Property. B) Income. C) Sales. D) Payroll. Show Answer Correct Answer: C) Sales. 29. The percentage change in real GDP from one year to the next is called: A) Real GDP. B) Nominal GDP. C) GDP growth rate. D) GDP per capita. Show Answer Correct Answer: C) GDP growth rate. 30. What is the size of the Labor Force?Unemployed (Looking for job) = 200Retired = 5Prison = 2 School (full time, not looking for job) = 10Employed = 180Unemployed (not looking for job) = 20 A) 220. B) 200. C) 180. D) 237. Show Answer Correct Answer: B) 200. ← 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