This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 134 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 134 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Define monetary policy. A) Involves the manipulation of monetary variables in order achieve government objectives. B) Any action taken by the government or monetary authorities (Monetary Policy Committee in the Bank of England) to shift the AD curve. C) Involves the government running a government or fiscal deficit (budget deficit). D) Any action taken by the government or monetary authorities (Monetary Policy Committee in the Bank of England) to shift the AS curve. Show Answer Correct Answer: A) Involves the manipulation of monetary variables in order achieve government objectives. 2. Aggregate demand is simplified with which of these equations? A) C + I + G-(X + M). B) C + I + G-(X-M). C) C + I + G + (X-M). D) C + I + G + (X + M). Show Answer Correct Answer: C) C + I + G + (X-M). 3. Fiscal policy primarily refers to changes in A) Annual interest rates. B) The availability of credit. C) The amount of money in circulation. D) Government spending or tax revenue. Show Answer Correct Answer: D) Government spending or tax revenue. 4. If the economy is falling below potential real GDP, which of the following would be an appropriate fiscal policy to bring the economy back to long-run aggregate supply? An increase in A) Taxes. B) Government purchases. C) The money supply and a decrease in interest rates. D) Oil prices. Show Answer Correct Answer: B) Government purchases. 5. What do you call the payment the firms received from the households? A) TAXES. B) REVENUES. C) BENEFITS. D) None of above. Show Answer Correct Answer: B) REVENUES. 6. Net exports is a measurement of GDP. How do you calculate net exports? A) Exports minus imports. B) Exports plus imports. Show Answer Correct Answer: A) Exports minus imports. 7. Macroeconomics became popular after A) 1996-97. B) 1929-33. C) 1972-73. D) 2006-07. Show Answer Correct Answer: B) 1929-33. 8. The ability-to-pay principle states A) Those with the greatest ability to pay taxes should pay more. B) Those with the least ability to pay taxes should pay more. C) Individuals receiving the benefits should pay for them. D) All of the above are true. Show Answer Correct Answer: A) Those with the greatest ability to pay taxes should pay more. 9. All of the following are excluded from GDP except A) Non-market goods and services. B) Used goods. C) Environmental quality. D) Final goods and services. Show Answer Correct Answer: D) Final goods and services. 10. There are two possible reasons for total spending to rise from one year to the next:larger output and higher prices A) False. B) True. Show Answer Correct Answer: B) True. 11. Payments or support from the government given to businesses. A) Substitutes. B) Complements. C) Subsidies. D) Regulations. E) Costs. Show Answer Correct Answer: C) Subsidies. 12. Which statement about natural resources is true? A) Lumber is not renewable because it takes a long time to grow new trees. B) Agricultural products are renewable because new crops can be grown each season. C) Coal is renewable because there is so much of it still in the ground. D) Water is renewable because it can be reproduced. Show Answer Correct Answer: B) Agricultural products are renewable because new crops can be grown each season. 13. Assume that a tire company sells 5 tires to an automobile company for $ 500, another company sells a compact disc player for $ 400, and the automobile company puts all of these items in or on a car that it sells for $ 20, 000. In this case, the amount from these transactions that should be counted in GDP is A) $ 20, 000. B) $ 20, 000 less the automobile company's profit on the car. C) $ 20, 900. D) $ 20, 900 less the profits of all three companies on the items that they sold. Show Answer Correct Answer: A) $ 20, 000. 14. Adam Smith is considered the "father" of what Economic system? A) Traditional Economy. B) Socialism. C) Capitalism. D) Communism. Show Answer Correct Answer: C) Capitalism. 15. Roads, telephone lines, power facilities, and schools are examples of a nation's: A) Political structure. B) Physiostructure. C) Technostructure. D) Infrastructure. E) Sociostructure. Show Answer Correct Answer: D) Infrastructure. 16. TRUE or FALSE:The Human Development Index is based upon measures of life expectancy, education and literacy, and GDP per capita. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 17. Money that is issued by the authority of the government is called- A) Full bodied money. B) Fiat money. C) Fuduciary money. D) All the above. Show Answer Correct Answer: B) Fiat money. 18. For a bank, a loan would be considered a(n) ....., while a business would consider the same loan to be a(n) ..... A) Asset, liability. B) Liability, asset. Show Answer Correct Answer: A) Asset, liability. 19. Balance of trade is measure as A) Difference between import and export of goods. B) Difference between import and export of services. C) Difference between import and export of capital. D) Difference between all exports and all imports. Show Answer Correct Answer: A) Difference between import and export of goods. 20. Movement within the workforce is known as ..... unemployment. A) Cyclical. B) Seasonal. C) Stuctural. D) Frictional. Show Answer Correct Answer: D) Frictional. 21. Which of the following Federal Reserve actions would most likely help counteract an oncoming recession? A) An increase in government bonds and an increase in the discount rate. B) The sale of government bonds and an increase in the discount rate. C) An increase in reserve requirements. D) The purchase of government bonds and a reduction in the discount rate. E) Raise the interest rate paid on reserves. Show Answer Correct Answer: D) The purchase of government bonds and a reduction in the discount rate. 22. All other things being equal, an economy is most likely to experience demand-pull inflationary pressure when it has A) An increase in the value of its exchange rate. B) A high rate of productivity growth. C) An increase in the rate of interest. D) A positive output gap. Show Answer Correct Answer: D) A positive output gap. 23. The institution that releases figures for Indonesia's Gross Domestic Product or Indonesia's Economic Growth is A) Bappenas. B) Fiscal policy Agency. C) Bank Indonesia. D) Central Bureau of Statistics. Show Answer Correct Answer: D) Central Bureau of Statistics. 24. Match the following description with the factor that impacts growth in developing nations:Tropical parts of the world have more diseases and less good farm land. A) Geography and Natural Resources. B) Free Trade. C) Investments in Human Capital. D) Economy. Show Answer Correct Answer: A) Geography and Natural Resources. 25. ..... is the view that individuals and firms make decisions optimally, using all available information. A) Rational Expectations. B) Macroeconomic Policy Activism. C) Discretionary Monetary Policy. D) Monetary Policy Rule. Show Answer Correct Answer: A) Rational Expectations. 26. A positive impact on investments could be due to A) Better funding conditions. B) Higher interest rates. C) Higher tariffs abroad. D) None of above. Show Answer Correct Answer: A) Better funding conditions. 27. A percentage charged above and beyond the actual value of the loan, this must also be paid back. A) Fiat Money. B) Interest. C) Loan. D) Specie Money. E) Commodity Money. Show Answer Correct Answer: B) Interest. 28. Shows the relationship between the aggregate price level and the quantity of aggregate output supplied in the economy A) Aggregated Supply. B) Aggregated Demand. C) Budget. D) Labor force. Show Answer Correct Answer: A) Aggregated Supply. 29. Consumer confidence falls, which causes consumers to save their money & postpone big purchases. What is the immediate effect on aggregate demand, price level & aggregate supply? A) AD decreases, price level decreases & unemployment decreases. B) AD decreases, lowering both real GDP & the price level. C) AS will decrease, raising the price level & lowering real GDP. D) AS will increase, price level decreases & real GDP will increase. Show Answer Correct Answer: B) AD decreases, lowering both real GDP & the price level. 30. The Consumer Price Index is used to help measure the amount of ..... in the U.S. to better help achieve the goal of ..... A) Change, economic stability. B) Money, monetary policy. C) Inflation, price stability. D) Unemployment, full employment. Show Answer Correct Answer: C) Inflation, price stability. ← 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