This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 160 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 160 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Programs that are triggered (social security, progressive taxes) if changes in the economy threaten personal income are called A) Legislative lag. B) Implementation lag. C) Mood stabilizers. D) Automatic stabilizers. Show Answer Correct Answer: D) Automatic stabilizers. 2. The price of goods gradually increasing over time defines what economic situation? A) Deflation. B) Recession. C) Depression. D) Inflation. Show Answer Correct Answer: D) Inflation. 3. Which restriction to trade occurs when the value of an individual's currency is less than the value of the currency of a country they are visiting? A) Tariff. B) Exchange rate. C) Inflation. D) Embargo. Show Answer Correct Answer: B) Exchange rate. 4. Which component of GDP is the largest? A) Exports. B) Imports. C) Income. D) Consumption. E) Government purchases. Show Answer Correct Answer: D) Consumption. 5. What is a budget deficit? A) When revenue equals income. B) When revenue is larger than expenditures. C) When spending equals revenue. D) When spending is larger than revenue. Show Answer Correct Answer: D) When spending is larger than revenue. 6. Which of the following is expansionary policy? A) Selling bonds. B) Increase fed fund rate. C) Decrease discount rate. D) Increase required reserves. Show Answer Correct Answer: C) Decrease discount rate. 7. Which the following is one of the two goals of an expansionary fiscal policy? A) Increase government regulation/control over the economy. B) Increase Real GDP. C) Increase unemployment. D) Increase national debt. Show Answer Correct Answer: B) Increase Real GDP. 8. Scarce resoues can be defined as ..... A) A resource with an available quantity less than its desired use. B) A resource with an available quantity more than its desired use. Show Answer Correct Answer: A) A resource with an available quantity less than its desired use. 9. The Federal Reserve is worried about inflation and decides that it must reduce the circulation of money in the economy. Which actions could the "Fed" take that would most likely result in a decrease in the money supply? A) Raise the reserve requirements; raise the discount rate; and sell securities (bonds). B) . lower the reserve requirements; lower the discount rate; and buy securities (bonds). Show Answer Correct Answer: A) Raise the reserve requirements; raise the discount rate; and sell securities (bonds). 10. On the island of Yap, large circular stones are used for money. The main reason why this type of money serves its function as a medium of exchange is because it is A) Very portable. B) Accepted as payment. C) Prized in foreign transactions. D) Highly divisible. Show Answer Correct Answer: B) Accepted as payment. 11. When deciding to buy a home instead of renting an apartment, you are demonstrating that the extra expense is worth the amount of ..... A) Untility. B) Marginal cost. C) Risk. D) Scarcity. Show Answer Correct Answer: A) Untility. 12. What is the best known cartel? A) OPEC. B) Mexico. C) United States. D) None of above. Show Answer Correct Answer: A) OPEC. 13. How the value of currency determined in Floating Exchange Rate System? A) Through the government intervention. B) Through demand and supply of the currency. C) Through private agency. D) None of above. Show Answer Correct Answer: B) Through demand and supply of the currency. 14. We know with certainty that a tax increase must cause which of the following? A) An increase in investment. B) A reduction in investment. C) No change in investment. D) None of the above. Show Answer Correct Answer: B) A reduction in investment. 15. The money supply curve is A) Upward sloping. B) Horizontal. C) U-shaped. D) Vertical. Show Answer Correct Answer: D) Vertical. 16. Macroeconomics can best be described as the: A) Analysis of how a consumer tries to spend income. B) Analysis of how firms attempt to maximise their profit. C) Study of the large aggregates of the economy as a whole. D) Study of how supply and demand determine prices in individual markets. Show Answer Correct Answer: C) Study of the large aggregates of the economy as a whole. 17. Assume that consumption spending is $ 16, 000. For every $ 200 increase in disposable income, saving goes up by $ 20. Which of the following statements is true? A) The marginal propensity to consume is.10. B) The marginal propensity to consume is.20. C) The marginal propensity to save is.10. D) The marginal propensity to save is.20. Show Answer Correct Answer: C) The marginal propensity to save is.10. 18. A strong rise in energy cost is likely to lead to A) A rise in real GDP and the price level. B) A fall in GDP and the price level. C) A fall in real GDP but a rise in the price level. D) A rise in real GDP but a fall in the price level. Show Answer Correct Answer: C) A fall in real GDP but a rise in the price level. 19. Real GDP is different than GDP because A) Real GDP is adjusted for inflation (prices and populations change over time). B) Real GDP includes other counties too. Show Answer Correct Answer: A) Real GDP is adjusted for inflation (prices and populations change over time). 20. What is the difference between real and nominal GDP? A) Real GDP = adjusted for inflation; Nominal GDP = not adjusted for inflation. B) Nominal GDP = adjusted for inflation; Real GDP = not adjusted for inflation. C) They are the same thing. D) None of above. Show Answer Correct Answer: A) Real GDP = adjusted for inflation; Nominal GDP = not adjusted for inflation. 21. All of the following are examples of direct taxes EXCEPT A) Personal income tax. B) Service tax. C) Company tax. D) Stamp duty. Show Answer Correct Answer: B) Service tax. 22. The table below shows the cost of the same representative basket of goods in the base year 2012 and in 2013, and the average weekly nominal wage rate in 2012 and 2013. If 2012 is the base year, which of the following is true? A) Based on the CPI, the average real weekly wage rate decreased by 20% from 2012 to 2013. B) Based on the CPI, the average real weekly wage rate increased by 10% from 2012 to 2013. C) The inflation rate from 2012 to 2013 is 10%. D) The CPI in year 2013 is 120. E) The CPI in year 2013 is 110. Show Answer Correct Answer: D) The CPI in year 2013 is 120. 23. People who own these have part ownership of the firm, which means they receive some of its profits, or losses. A) Bonds. B) Financial Intermediaries. C) Mutual Funds. D) Stocks. Show Answer Correct Answer: D) Stocks. 24. If a popular TV show on personal finance convinces Americans to save more for retirement, the ..... curve for loanable funds would shift, driving the equilibrium interest rate ..... A) Demand; down. B) Supply; up. C) Demand; up. D) Supply; down. Show Answer Correct Answer: D) Supply; down. 25. The Federal Reserve System controls the size of the A) Tax supply. B) Money supply. C) Demand supply. D) Production supply. Show Answer Correct Answer: B) Money supply. 26. Which of the following statements are true of the aggregate supply curve? A) The aggregate supply curve describes the relationship between the quantity of output supplied in the short run and the price level. B) The aggregate supply curve shifts leftward when costs of production increase. C) The aggregate supply curve shifts rightward when costs of production decrease. D) All of the above. Show Answer Correct Answer: D) All of the above. 27. What is the trough in the business cycle? A) The accumulation of government deficits over the years. B) The highest point of Real GDP. C) The lowest point of Real GDP. D) The period of falling Real GDP. Show Answer Correct Answer: C) The lowest point of Real GDP. 28. Patrick works in the oilfield and the low gas prices have caused his company to temporarily lay people off! He is experiencing what kind of unemployment? A) Frictional. B) Cyclical. C) Structural. D) Seasonal. Show Answer Correct Answer: A) Frictional. 29. What is the main difference between M1 and M2 as measures of money? A) M2 includes the value of savings accounts with longer maturities while M1 does not. B) M2 includes the value of checking accounts while M1 does not. C) M2 includes the value of mutual funds while M1 does not. D) M2 includes the value of government bonds while M1 does not. E) M2 includes the value of traveler's checks while M1 does not. Show Answer Correct Answer: A) M2 includes the value of savings accounts with longer maturities while M1 does not. 30. What will happen to the demand for money if real GDP rises? A) It will decrease. B) It depends on what happens to interest rates. C) It will be unchanged. D) It will increase. Show Answer Correct Answer: D) It will increase. ← 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