This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 142 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 142 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. How often is GDP calculated? A) Every year. B) Every quarter. C) Every 2 years. D) Every 4 years. Show Answer Correct Answer: A) Every year. 2. A worker in Thailand can earn $ 2 per day making cotton cloth on a hand loom. A worker in the US can earn $ 80 per day making cotton cloth with a mechanical loom. What accounts for the difference in wages? A) US textile workers belong to a union. B) There is little demand for cotton cloth in Thailand and great demand in the US. C) Labor is more productive making cotton cloth with a mechanical loom than with a hand loom. D) Worker expectations are lower in Thailand then in the US. E) Thailand has a low-wage policy to make its textile industry more competitive in world markets. Show Answer Correct Answer: C) Labor is more productive making cotton cloth with a mechanical loom than with a hand loom. 3. What is the main goal of economic stability? A) To achieve fluctuating price levels. B) To achieve low unemployment rates. C) To achieve high inflation rates. D) To achieve rapid economic growth. Show Answer Correct Answer: B) To achieve low unemployment rates. 4. The following monetary policy instruments, except..... A) Changes in interest rate. B) Changes the reserve-deposit ratio. C) Open-market operations. D) Changes in exchange rate. Show Answer Correct Answer: D) Changes in exchange rate. 5. If two countries have the same GDP, then the economic well-being of both countries should be the same. A) True. B) Lie. Show Answer Correct Answer: B) Lie. 6. A medium of exchange is ..... A) Something that is generally acceptable in exchange for goods and services. B) A legally recognized asset that is generally accepted in exchange for goods and services. C) Something that circulates and provides a standardized means of evaluating the relative price of goods and services. D) The ability of money to command purchasing power in the future. Show Answer Correct Answer: A) Something that is generally acceptable in exchange for goods and services. 7. Which of the following is the best example of physical capital? A) An increase in construction jobs. B) An oven for a family of four. C) A truck for a delivery company. D) A business hiring 10, 000 workers at a factory. E) A $ 100, 000 business loan from a bank. Show Answer Correct Answer: C) A truck for a delivery company. 8. Inflation only affects consumers who have high incomes. A) False. B) True. Show Answer Correct Answer: A) False. 9. The High Rock City Shoe Company has been forced to downsize. Which is the most likely effect of such an action? A) Many unskilled laborers who work for the company will lose their jobs. B) More of the company's stock will be sold at a higher price. Show Answer Correct Answer: A) Many unskilled laborers who work for the company will lose their jobs. 10. A ..... is a phenomenon in which many of a bank's depositors try to withdraw their funds due to fears of a bank failure. A) Reserve Run. B) Bank Run. C) Excess Reserve. D) Discount Window. Show Answer Correct Answer: B) Bank Run. 11. Disposable income is ..... A) Marginal Propensity to Consume. B) Marginal Propensity to Save. C) Personal Income less Taxes. D) All of the above choices are true. Show Answer Correct Answer: C) Personal Income less Taxes. 12. India's economy grew by approximately 7% in 2016. What must have increased in India in 2016? A) Gross domestic product. B) Labor productivity. C) The government's budget deficit. D) The rate of inflation. Show Answer Correct Answer: A) Gross domestic product. 13. The federal government levies a tax on personal income to provide for A) National defense and law enforcement. B) Veterans and foreign affairs. C) Social programs like food and housing assistance and college grants. D) All answers shown. Show Answer Correct Answer: D) All answers shown. 14. How many phases make up the business cycle? A) 8. B) 6. C) 4. D) 2. Show Answer Correct Answer: C) 4. 15. Represents the monetary value of all goods and services produced within a nation's geographic borders over a specified period of time A) GDP. B) Aggregate Supply. C) Aggregate Demand. D) Inflation Rate. Show Answer Correct Answer: A) GDP. 16. Who wrote the book The Wealth of Nations? A) John Hancock. B) Adam Smith. C) Alexander Bell. D) John Hamilton. Show Answer Correct Answer: B) Adam Smith. 17. Inflation reduced people's purchasing power because A) The same amount of money buys ore goods and services. B) The same amount of money buys fewer goods and services. C) The market basket has to be changed every year. D) There is not enough money in the economy. Show Answer Correct Answer: B) The same amount of money buys fewer goods and services. 18. TRUE or FALSE:Satellite accounts measure the value of natural capital in physical terms, without necessarily converting into dollar terms. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 19. Which will not shift the supply curve? A) New technology. B) Price of inputs. C) Natural Disasters. D) Price of complementary products. Show Answer Correct Answer: D) Price of complementary products. 20. What is the TRUE definition of inflation? A) Inflation:The continuous increase in general level of price which then reduces the population income & purchasing power of money. B) Inflation:The process of inflating baloons to celebrate economic prosperity of the country. C) Inflation:A term used to describe the increase in the number of items available in grocery store to provide more options for consumers. D) None of above. Show Answer Correct Answer: A) Inflation:The continuous increase in general level of price which then reduces the population income & purchasing power of money. 21. When governments run budget surpluses, what is done with the extra funds? A) Distribute it as cash payments to citizens. B) Pay off existing debt, invest in infrastructure, or create a reserve fund. C) Use it to increase government salaries . D) Invest in military expansion. Show Answer Correct Answer: B) Pay off existing debt, invest in infrastructure, or create a reserve fund. 22. The Federal Reserve can increase ....., which makes banks more selective when loaning out money A) Dividends. B) Reserve Requirements. C) Percentage/Earnings Ratios. D) Blue Chip Stocks. Show Answer Correct Answer: B) Reserve Requirements. 23. In the short run an increase in the money supply is likely to lead to A) Lower unemployment and lower inflation. B) Lower unemployment and higher inflation. C) Higher unemployment and lower inflation. D) Higher unemployment and higher inflation. E) Higher unemployment but will have no effect on inflation. Show Answer Correct Answer: B) Lower unemployment and higher inflation. 24. Decrease in the overall level of prices is A) Inflation. B) Deflation. C) Hyperinflation. D) None of them. Show Answer Correct Answer: B) Deflation. 25. The change in total costs of producing one additional unit of output is called: A) Marginal cost. B) Variable cost. C) Opportunity cost. D) Average total cost. Show Answer Correct Answer: A) Marginal cost. 26. An increase in government spending with no change in taxes leads to a A) Lower income level. B) Lower price level. C) Smaller money supply. D) Higher interest rate. E) Higher bond price. Show Answer Correct Answer: D) Higher interest rate. 27. Which of the following area is a part of Macro-Economics Study? A) Evaluation of GDP Levels. B) Individual Markets. C) Effect of Price on specific Goods. D) Study of Individual consumer behavior. Show Answer Correct Answer: A) Evaluation of GDP Levels. 28. This is the term for the total amount of all goods and services in the economy that households, businesses, and government will buy at each level of prices? A) Aggregate Equilibrium. B) Aggregate Demand. C) Aggravated Surplus. D) Aggregate Supply. Show Answer Correct Answer: B) Aggregate Demand. 29. When people are in the process of looking for a job after being fired or are transitioning to a new position, this is called? A) Frictional Unemployment. B) Structural Unemployment. C) Cyclical Unemployment. D) None of above. Show Answer Correct Answer: A) Frictional Unemployment. 30. Which of the following economist is not a part of Life Cycle Hypothesis? A) Albert Ando. B) Richard Brumberg. C) Modigliani. D) James Dusenberry. Show Answer Correct Answer: D) James Dusenberry. ← 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