This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 153 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 153 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Assume Truelove and Barrientes World had a balanced budget when the year began. Unexpectedly, at the end of the year tax revenues were $ 4 million higher than expected and spending was exactly as budgeted. Which situation is Truelove and Barrientes World in currently? A) Trade deficit. B) Budget surplus. C) Budget deficit. D) Trade surplus. Show Answer Correct Answer: B) Budget surplus. 2. Why we need a protectionism in international trade? A) To increase income. B) To increase employment in the country. C) To encourage dumping. D) To protect young industries. Show Answer Correct Answer: D) To protect young industries. 3. A country can be said to be experiencing hyperinflation if..... A) Inflation rate 10% per year. B) Inflation rate 50% per year. C) Inflation rate 50% per Month. D) Inflation rate 10% per Month. Show Answer Correct Answer: C) Inflation rate 50% per Month. 4. Consider the various types of unemployment discussed in the text, which type of unemployment is LEAST likely to be affected by government policies? A) Structural unemployment. B) Frictional unemployment. C) Recessionary unemployment. D) Cyclical unemployment. E) All of the above, since policies have no effect on unemployment. Show Answer Correct Answer: B) Frictional unemployment. 5. If the Federal Reserve is using an expansionary monetary policy, where it is trying to increase the money supply it would do all of the following except ..... A) Buy bonds on the open market. B) Decrease interest payments on reserves. C) Increase reserve requirement. D) Decrease discount rate. Show Answer Correct Answer: C) Increase reserve requirement. 6. When an individual is unemployed because they are looking for a new job. A) Structural Unemployment. B) Frictional Unemployment. C) Seasonal Unemployment. D) Cyclical Unemployment. Show Answer Correct Answer: B) Frictional Unemployment. 7. The three macroeconomic goals are A) Supply, Demand, and Determinants. B) Steady Economic Growth, Low Unemployment, and Price Stability. C) Inelasticity, Price Ceilings, and Government Regulation. D) Marginal Utility, Glass Ceilings, and GDP. Show Answer Correct Answer: B) Steady Economic Growth, Low Unemployment, and Price Stability. 8. Which of the following is not a function of a commercial bank? A) Banknote printing. B) Mobilize deposits. C) Provide credit. D) Transfer money between accounts. Show Answer Correct Answer: A) Banknote printing. 9. All of the following are tools in monetary policy except ..... A) Open Market Operations. B) Reserve Requirements. C) Discount Rate. D) Stocks. Show Answer Correct Answer: D) Stocks. 10. Which one of the advantages below related with a LOWER OPPORTUNITY COST? A) Comparative advantages. B) Absolute advantages. Show Answer Correct Answer: A) Comparative advantages. 11. Imagine you are an economist studying a particular country. You want to calculate the total value of all final goods and services produced in that country in a given year. What term would you use to describe this? A) Unemployment. B) Consumer Price Index. C) Gross Domestic Product. D) Inflation. Show Answer Correct Answer: C) Gross Domestic Product. 12. If unemployed workers decide to stop looking for a job and instead enroll in further education, how will the number of employed workers and the unemployment rate change? A) The number of employed workers increases; the unemployment rate decreases. B) The number of employed workers does not change; the unemployment rate increases. C) The number of employed workers does not change; the unemployment rate decreases. D) The number of employed workers does not change; the unemployment rate does not change. E) The number of employed workers decreases; the unemployment rate increases. Show Answer Correct Answer: C) The number of employed workers does not change; the unemployment rate decreases. 13. If the central bank sets the interest rate to be forced higher, what kind of credit will commercial banks be able to give? A) Increased. B) Decrease. C) Does not change. D) All wrong. Show Answer Correct Answer: B) Decrease. 14. Which of the following is a reason for increase in AD? A) Decrease in investment. B) Decrease in export. C) Decrease in consumption. D) Decrease in import. Show Answer Correct Answer: D) Decrease in import. 15. 'More productive workers receive higher wages than less productive workers.' This observation is a major flaw in which of the following arguments for protectionism? A) The infant industry argument. B) The employment argument. C) The national security argument. D) The cheap foreign labour argument. Show Answer Correct Answer: D) The cheap foreign labour argument. 16. Which of the following is not one of the three market arenas? A) Financial market. B) Goods and services market. C) Labor market. D) Business market. Show Answer Correct Answer: D) Business market. 17. Contractionary Fiscal Policy Is What? A) Policy that is aimed to reduce inflation. B) Where there is a change in interest rates to cause a decline in the economy. C) The gap that leads to lower GDP and a higher price level. D) Laws that reduce unemployment and increase GDP. Show Answer Correct Answer: A) Policy that is aimed to reduce inflation. 18. Money interest has been known long before Christ (Sumerian and Babylonian times). The age of the Flower Concept is very old. The book that prohibits wearing flowers can be found in the book..... A) Torah. B) Gospel. C) The Quran. D) All answers are correct. Show Answer Correct Answer: D) All answers are correct. 19. Gross domestic product is the sum of the market value of the ..... goods and services A) Intermediate. B) Inferior. C) Final. D) Normal. Show Answer Correct Answer: C) Final. 20. Which of the following types of unemployment is caused by a recession? A) Cyclical. B) Seasonal. C) Structural. D) Hidden. E) Frictional. Show Answer Correct Answer: A) Cyclical. 21. What is the key aim of supply-side policies? A) Reduce government spending. B) Improve the environment. C) Increase economic growth. D) Reduce price level. Show Answer Correct Answer: C) Increase economic growth. 22. What always results in an increase in price and quantity? A) Human and physical. B) Total satisfaction or benefit from consuming a good or service. C) The action of buying and selling goods and services. D) An increase in demand with no change in supply. Show Answer Correct Answer: D) An increase in demand with no change in supply. 23. The ..... shows the various combinations of output and the interest rate when the goods market is in equilibrium A) LM curve. B) IS curve. C) Demand curve. D) Supply curve. Show Answer Correct Answer: B) IS curve. 24. The so-called "natural" ( or post-WWII average ..... ) rate of unemployment (URN) in the US is approximately: A) 4%. B) 12%. C) 6%. D) 8%. Show Answer Correct Answer: C) 6%. 25. What is NOT included in GDP? A) Intermediate goods. B) Stocks, bonds, real estate. C) Illegal activities. D) All of these are correct. Show Answer Correct Answer: D) All of these are correct. 26. What is the difference between expansionary monetary policy and contractionary monetary policy? A) Expansionary policy involves increasing the money supply, while contractionary policy involves decreasing the money supply. B) Expansionary policy involves decreasing interest rates, while contractionary policy involves increasing interest rates. C) Expansionary policy involves increasing government spending, while contractionary policy involves decreasing government spending. D) None of the above. Show Answer Correct Answer: A) Expansionary policy involves increasing the money supply, while contractionary policy involves decreasing the money supply. 27. Which statement best describes monetary policy and fiscal policy? A) Monetary policy reflects the Federal Reserve's authority to change the money supply; fiscal policy reflects the government's power to influence the economy through taxes, expenditures, and borrowing. B) Monetary policy reflects the Federal Reserve's authority to change tax rates; fiscal policy reflects the government's power to influence the money supply by lowering the discount rate for loans to banks. C) Monetary Policy refers to the Federal Reserve;s influence in the economy through borrowing and creating a deficit; fiscal policy refers to the government's authority to increase the discount rate for loans to bank. D) None of above. Show Answer Correct Answer: A) Monetary policy reflects the Federal Reserve's authority to change the money supply; fiscal policy reflects the government's power to influence the economy through taxes, expenditures, and borrowing. 28. What is is the deliberate attempt by RBI to keep foreign exchange rate in a desired limit is called A) Appreciation of currency. B) Depreciation of currency. C) Managed float. D) Adjustable peg. Show Answer Correct Answer: C) Managed float. 29. He country of Aceland produces two goods, televisions and computers. Last year, it produced 200 televisions and 500 computers; this year it produced 250 televisions and 600 computers. Given no other information, which of the following events could NOT explain this change? A) Aceland experienced a decrease in unemployment. B) Aceland experienced an improvement in computer-making technology. C) Aceland acquired more resources. D) Aceland experienced an increase in underemployment. Show Answer Correct Answer: D) Aceland experienced an increase in underemployment. 30. Which of the following is a supply-side policy aimed at improving technological innovation? A) Increasing interest rates. B) Increasing government spending. C) Investing in research and development. D) Implementing price controls. Show Answer Correct Answer: C) Investing in research and development. ← 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