This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 168 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 168 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If the central bank wants to expand aggregate demand, it can ..... the money supply, which would ..... the interest rate. A) Decrease, decrease. B) Decrease, increase. C) Increase, decrease. D) Increase, increase. Show Answer Correct Answer: C) Increase, decrease. 2. How does investment in capital goods by companies help a country increase its GDP? A) The GDP of a country goes down when companies make more money. B) Companies that invest in capital goods are able to provide a better place for their workers to work. C) Highly trained workers help the company be more profitable by finding ways to help the company work better. D) When a company invests in capital, it can produce more goods at a better price and increase the profit that it makes. Show Answer Correct Answer: D) When a company invests in capital, it can produce more goods at a better price and increase the profit that it makes. 3. In macroeconomics, we study about A) Theory of National Income & Employment. B) Theory of Money Supply & Price Level. C) Theory of International Trade and Economic growth. D) All of the above. Show Answer Correct Answer: D) All of the above. 4. The increase in unemployment caused by the recession phase of the business cycle is called A) Seasonal Unemployment. B) Cyclical unemployment. C) Structural unemployment. D) Frictional unemployment. Show Answer Correct Answer: B) Cyclical unemployment. 5. What would be the effect of the United States establishing tariffs on solar energy products from China? A) U.S. consumers would pay more for Chinese solar products. B) U.S. solar manufacturers would slow production. C) Chinese solar manufacturers would lower domestic prices. D) Chinese consumers would purchase more U.S. solar products. Show Answer Correct Answer: A) U.S. consumers would pay more for Chinese solar products. 6. Assume that the marginal propensity to consume out of disposable income is 0.8 and that the government taxes all income at a constant rate of 30 percent. If gross income increases by $ 100, consumption will initially increase by A) $ 70. B) $ 44. C) $ 100. D) $ 80. E) $ 56. Show Answer Correct Answer: E) $ 56. 7. In the Mundell-Fleming model, the domestic interest rate is determined by the: A) Intersection of the LM and IS curves. B) Domestic rate of inflation. C) World rate of inflation. D) World interest rate. Show Answer Correct Answer: D) World interest rate. 8. In terms of resources, what do households provide for businesses? A) Savings. B) Private goods. C) Labor. D) Loans. Show Answer Correct Answer: C) Labor. 9. Which of the following is an example of intermediate goods?(i) (ii)(iii) (iv) A) Car sold by a dealer of secondhand cars. B) Steel and cement used to construct a flyover. C) Fertilizer purchased by a farmer. D) All of these. Show Answer Correct Answer: A) Car sold by a dealer of secondhand cars. 10. What are the three main outcomes policymakers pursue to stabilize the economy? A) High employment, steady growth, stable prices. B) Low employment, rapid growth, fluctuating prices. C) Low employment, steady growth, fluctuating prices. D) High employment, rapid growth, stable prices. Show Answer Correct Answer: A) High employment, steady growth, stable prices. 11. The main stream view among economist is that A) Society face is a trade-off between unemployment and inflation, but only in the short run. B) Society face is a trade-off between unemployment and inflation, but only in the long run. C) Society face as a trade off between unemployment and inflation, but in the short run and in the long run. D) The trade-off exists for unemployment in the short run and for inflation in the long run. Show Answer Correct Answer: A) Society face is a trade-off between unemployment and inflation, but only in the short run. 12. Discount Rate is the fee that A) The member bank must pay the district bank for a loan. B) You and I must pay our bank for a loan. C) The district bank pays the national bank for a loan. D) The FED pays FOMC for services. Show Answer Correct Answer: A) The member bank must pay the district bank for a loan. 13. Income that is actually received by individuals and households in an economy in a year is ..... A) Value added. B) Personal income. C) Nominal national income. D) Transfer payments. Show Answer Correct Answer: B) Personal income. 14. Why doesn't GDP count intermediate goods? A) The intermediate value may have different stages. B) Intermediate value cannot be calculated. C) Intermediate value is calculated into GNP. D) Intermediate value is included in the value of the final good. Show Answer Correct Answer: D) Intermediate value is included in the value of the final good. 15. Which of the following is NOT an implicit liability of the US Government A) Social Security. B) Military Budget. C) Medicaid. D) Medicare. Show Answer Correct Answer: B) Military Budget. 16. The required reserve ratio is 0.2 and the Federal Reserve sells $ 1 million in securities. If there are no leakages and banks do not hold excess reserves, then which of the following is the change in the money supply? A) A decrease of $ 5 million. B) An increase of $ 5 million. C) An increase of $ 1.2 million. D) An increase of $ 1 million. E) A decrease of $ 1.2 million. Show Answer Correct Answer: A) A decrease of $ 5 million. 17. Which one of the following is the best example of commodity money? A) Real estate. B) Dollar bills. C) Business stocks. D) Valuable painting. E) Goldd coins. Show Answer Correct Answer: E) Goldd coins. 18. Which of the following terms refers to goods and services produced in the US and sold abroad? A) GDP. B) Exports. C) Imports. D) Factors of Production. Show Answer Correct Answer: B) Exports. 19. If the Federal Reserve wanted to stimulate the U.S. economy and reduced unemployment, it would A) Cause interest rates to decrease because low interest rates encourage business growth and expansion. B) Cause interest rates to rise because high interest rates encourage growth and expansion. C) Increase the discount rate it charges banks. D) Reduce the money supply. Show Answer Correct Answer: A) Cause interest rates to decrease because low interest rates encourage business growth and expansion. 20. Fiscal policy is defined as: A) The use of government taxing and spending to promote economic stability. B) The policy of laissez-faire. C) A set of government actions designed to increase unemployment over 5%. D) The use of government quotas to decrease GDP and unemployment. Show Answer Correct Answer: A) The use of government taxing and spending to promote economic stability. 21. Contractionary monetary policy will tend to have what effect? A) A higher nominal interest rate. B) A decrease in aggregate demand. C) A higher nominal interest rate and a decrease in the aggregate demand curve. D) A lower nominal interest rate and an increase in the aggregate demand curve. Show Answer Correct Answer: C) A higher nominal interest rate and a decrease in the aggregate demand curve. 22. Which of the following is NOT an example of a bank asset? A) Government bonds. B) Checkable deposits. C) Commercial loans. D) Reserves. E) All of these are examples of bank assets. Show Answer Correct Answer: B) Checkable deposits. 23. Which of the following possitions has the largest share in a GDP in Poland? A) Personal consumption expediture. B) Government expenditure. C) Gros privete domestic investments. D) Net export. Show Answer Correct Answer: A) Personal consumption expediture. 24. The "Public sector" refers to the part of the economy that is controlled by the government A) True. B) False. Show Answer Correct Answer: A) True. 25. Reduces aggregate demand (a decrease in government purchases of goods and services, an increase in taxes, a decrease in government transfers) A) Budget. B) Contractionary Fiscal Policy. C) Expansionary Fiscal Policy. D) Discretionary Fiscal Policy. Show Answer Correct Answer: B) Contractionary Fiscal Policy. 26. Microeconomics is a ..... equilibrium analysis as it studies. A) General. B) Partial. Show Answer Correct Answer: B) Partial. 27. Supply side economics has been widely criticised because the reduction of taxes does not lead to what? A) An increase in taxes collected. B) Shopkeeper's stress. C) Reagonomics. D) Truth, justice and the American way. Show Answer Correct Answer: A) An increase in taxes collected. 28. If there is a shortage of beef at Fry's which of the following is the MOST likely to happen? A) They will produce more beef. B) The price will rise. C) The price will fall. D) There will be no change. Show Answer Correct Answer: B) The price will rise. 29. Use to calculate the inflation rate in the country A) CPI. B) Unemployment rate. C) GDP. D) None of above. Show Answer Correct Answer: A) CPI. 30. The ..... is the large economics that respond to the country A) Microeonomics. B) Macroeconomics. Show Answer Correct Answer: B) Macroeconomics. ← 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