This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 163 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 163 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The Federal Reserve uses ..... to regulate the economy. A) Fiscal Policy. B) Monetary Policy. Show Answer Correct Answer: B) Monetary Policy. 2. The ..... allows banks that fall short of the reserve requirement to borrow funds from banks with excess reserves. A) Reserve Market. B) Federal Funds Market. C) Open Market. D) Closed Market. Show Answer Correct Answer: B) Federal Funds Market. 3. The flow of land, labor, capital and entrepreneurship would be best represented from ..... to ..... A) Firms to Factor Market. B) Household to Product Market. C) Firms to Households. D) Household to Factor Market. Show Answer Correct Answer: D) Household to Factor Market. 4. In March 2018, 5, 000 US residents were employed and 3, 000 were unemployed. Find the unemployment rate. A) 60 %. B) 62.5 %. C) 37.5%. D) 50 %. Show Answer Correct Answer: C) 37.5%. 5. Which of the following best describes the cause of crowding out? A) Competition between the government and private borrowers for loanable funds results in an increase in interest rates. B) Increases in the costs of inputs lead to decreases in domestic production. C) The Federal Reserve's open-market operations decrease the amount of funds banks have available for lending. D) Reductions in the government's budget deficit lead to fewer Treasury bonds being issued. E) The scarcity of funds forces Congress to decrease spending on critical public works programs. Show Answer Correct Answer: A) Competition between the government and private borrowers for loanable funds results in an increase in interest rates. 6. Carla discovers a time capsule in her backyard. Inside is a $ 50 bill printed in 1980. She is surprised to learn that it is still good! This statement describes which function of money? A) Sentimental value. B) Store of value. C) Medium of exchange. D) Unit of account. Show Answer Correct Answer: B) Store of value. 7. The short run aggregate supply would shift with a change to all of the following EXCEPT ..... A) Wage rates. B) The cost of raw materials. C) Changes in business taxes. D) Supply shocks (e.g., bad weather). E) No exception-all of the above would shift the short run aggregate supply. Show Answer Correct Answer: E) No exception-all of the above would shift the short run aggregate supply. 8. The social security tax is 6.2% on employees' income earned below $ 113, 000. Is this tax progressive, regressive or proportional? A) Progressive. B) Regressive. C) Proportional . D) None of above. Show Answer Correct Answer: C) Proportional . 9. Physical capital A) Limited quantities of resources to meet unlimited wants. B) A graph that describes the maximum amount of one good that can be produced for every possible level of production of the other good. C) Producing in a way that best uses all of the economy's resources. D) All human-made goods that are used to produce other goods and services; tools and buildings. Show Answer Correct Answer: D) All human-made goods that are used to produce other goods and services; tools and buildings. 10. To construct GDP, exports: A) And imports must be subtracted. B) And imports must be included. C) Must be subtracted and imports must be included. D) Must be included and imports must be subtracted. Show Answer Correct Answer: D) Must be included and imports must be subtracted. 11. Inflation is one of problems of macroeconomics goal. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 12. A recent high school graduate has never searched for a job before. She does not know what she is qualified to do. She turns down a job at a factory, hoping for better-paying work. What kind of unemployment is she experiencing? A) Cyclical. B) Frictional. C) Institutional. D) Structural. Show Answer Correct Answer: B) Frictional. 13. In a system of fractional-reserve banking, even without any action by the central bank, the money supply declines if households choose to hold ..... currency or if banks choose to hold ..... excess reserves. A) More. B) Less. Show Answer Correct Answer: A) More. 14. In the circular flow model, what do individuals SELL to businesses A) Resources. B) Money. C) Services. D) Goods. Show Answer Correct Answer: A) Resources. 15. How would the proportions of different age groups in the population compare between low-income developing countries and high-income developed countries? Low-income developing countries would have a A) Higher proportion of the elderly and higher proportion of young people. B) Higher proportion of the elderly and lower proportion of young people. C) Lower proportion of the elderly and higher proportion of young people. D) Lower proportion of the elderly and lower proportion of young people. Show Answer Correct Answer: C) Lower proportion of the elderly and higher proportion of young people. 16. What is the impact of technological progress on productivity? A) Technological progress leads to increased productivity. B) Technological progress leads to fluctuating productivity. C) Technological progress leads to decreased productivity. D) Technological progress has no impact on productivity. Show Answer Correct Answer: A) Technological progress leads to increased productivity. 17. During the contraction phase of a business cycle, it is most likely that: A) Inflation indicators are stable. B) Aggregate economic activity relative to potential output is decreasing. C) Investor preference for government securities declines. D) None of above. Show Answer Correct Answer: B) Aggregate economic activity relative to potential output is decreasing. 18. Analyzing the consequences of a free trade agreement between two countries A) Microeconomic. B) Macroeconomics. Show Answer Correct Answer: B) Macroeconomics. 19. Consider the problem Marsha faces of how to allocate her weekly allowance between books and videos. How will an increase in Marsha's allowance affect her budget on a supply and demand curve? A) Rotate her budget line, allowing her to buy more books but not more videos. B) Rotate her budget line, allowing her to buy more videos but not more books. C) Shift her budget line to the right. D) Shift her budget line to the left. Show Answer Correct Answer: C) Shift her budget line to the right. 20. What happen if export goods is more than import goods? A) Balance of payment surplus. B) Balance of payment deficit. Show Answer Correct Answer: A) Balance of payment surplus. 21. Which of the following has the same effect on the economy as increasing government spending is..... A) Increased tax rates. B) Withdrawal of the amount of money in circulation. C) Tax rate cuts. D) Increase in the amount of money in circulation. Show Answer Correct Answer: C) Tax rate cuts. 22. An example of final goods in national income accounts would be: A) New lawn mowers purchased by Cut-Rite Lawn Equipment & Supplies. B) Flowers and pots purchased by homeowner Joe Smith. C) Chemicals purchased by Green Grass Lawn Care Services. D) Seedlings and saplings purchased for resale by Wendy's Garden Center. Show Answer Correct Answer: B) Flowers and pots purchased by homeowner Joe Smith. 23. After much debate in congress, the House and Senate finally passed a bill calling for a 1 percent tax decrease and a cut in federal funding to artistic institutions. The president then signs the bill. This is an example of the government's A) Tight money pollicy. B) Open market operations. C) Fiscal policy. D) Monetary policy. Show Answer Correct Answer: C) Fiscal policy. 24. Which of the following is NOT a macroeconomics objective? A) To maintain domestic price instability. B) To achieve full employment of resources. C) To achieve sustainable economic growth. D) To achieve equal distribution of income. Show Answer Correct Answer: A) To maintain domestic price instability. 25. Autonomous expenditures are expenditures that changes when income changes. A) False. B) True. Show Answer Correct Answer: A) False. 26. As a limit to economic growth, environmental problems are more difficult to solve than resource problems because: A) Environmental problems don't automatically provide incentives for changed behavior. B) Resource problems don't automatically provide incentives for changed behavior. C) The opportunity cost of solving environmental problems in terms of GDP sacrificed is larger. D) The majority of scientists haven't determined the relationship between greenhouse gas emissions and climate change. E) Individuals rarely respond to higher prices when government taxes the products that create environmental problems. Show Answer Correct Answer: A) Environmental problems don't automatically provide incentives for changed behavior. 27. What monetary policy would the Federal Reserve adopt to stimulate economic growth? A) Lowering the supply of money. B) Increasing the supply of money. C) Lowering federal tax rates. D) Increasing federal tax rates. Show Answer Correct Answer: B) Increasing the supply of money. 28. The act of giving up one thing of value to gain another thing of value when both cannot be had at the same time A) Unemployment. B) Goal. C) Trade Off. D) Opportunity Cost. Show Answer Correct Answer: C) Trade Off. 29. The unemployment rate will drop if A) A person is hired into a new job. B) Someone who was previously laid off is rehired. C) An unemployed person stops looking. D) ALL of these answers are CORRECT. Show Answer Correct Answer: D) ALL of these answers are CORRECT. 30. Convergence theory states that countries that start out poor will grow faster than rich ones and eventually converge to the same growth rate as the rich ones. A) False. B) True. Show Answer Correct Answer: B) True. ← 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