This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 56 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 56 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The price of paper is rising and at the same time fewer people are reading paper books. In the market for books, what will happen to price and quantity? A) The change in price is unknown, but quantity will increase. B) Price will rise and quantity will fall. C) The change in price is unknown, but quantity will decrease. D) Price will fall and quantity will rise. Show Answer Correct Answer: C) The change in price is unknown, but quantity will decrease. 2. A legal minimum price A) Price control. B) Producer surplus. C) Price ceiling. D) Price floor. Show Answer Correct Answer: D) Price floor. 3. Which of the following policy actions would unambiguously reduce the supply of loanable funds and crowd out investment? A) An increase in taxes and a decrease in government spending. B) An increase in both taxes and government spending. C) A decrease in both taxes and government spending. D) A decrease in taxes together with an increase in government spending. Show Answer Correct Answer: D) A decrease in taxes together with an increase in government spending. 4. What are the determinants of aggregate demand? A) Consumption, investment, government spending, and net exports. B) Unemployment, taxes, inflation, and interest rates. C) Government spending, inflation, interest rates, and savings. D) Savings, exports, inflation, and interest rates. Show Answer Correct Answer: A) Consumption, investment, government spending, and net exports. 5. In recent years, people have benefited from greater amounts of leisure time. This trend: A) Has caused GDP to rise. B) Has caused GDP to fall. C) Made GDP fluctuate randomly. D) Is not accounted for in GDP. Show Answer Correct Answer: D) Is not accounted for in GDP. 6. How would Eurostat classify a 20-year old individual enrolled in college full-time and working 5 hours per week in the campus bookstore? A) Not in the labor force. B) A discouraged worker. C) Not surveyed. D) Employed. E) Unemployed. Show Answer Correct Answer: D) Employed. 7. What type of unemployment happens because of technology replacing human workers? A) Cyclical. B) Unjust. C) Frictional. D) Structural. Show Answer Correct Answer: D) Structural. 8. Which of the following is an example of an automatic stabilizer? When the economy goes into a recession, A) Congress begins hearings about a possible stimulus package. B) The Federal Reserve changes its target for the federal funds rate. C) Stock prices decline, particularly for firms in cyclical industries. D) More people become eligible for unemployment insurance benefits. Show Answer Correct Answer: D) More people become eligible for unemployment insurance benefits. 9. Which of the following is NOT one of the determinants of supply? A) Change in number of sellers. B) Change in cost of production/resources. C) Substitutes. D) Change in technology. Show Answer Correct Answer: C) Substitutes. 10. Which is NOT included in Gross Domestic Product (GDP) as a measure of the economy? A) Final goods and services. B) Work done at home such as house renovations. C) Dollars. D) Government spending. Show Answer Correct Answer: B) Work done at home such as house renovations. 11. Choices often have to be made because productive resources are limited while wants and needs are limited. This situation is known as A) Borrowing. B) Surplus. C) Scarcity. D) Budgeting. Show Answer Correct Answer: C) Scarcity. 12. What would be the effect on the demand for money curve (L) of a rise in the bond prices? A) There would be a movement down along L. B) L would shift to the right. C) There would not be an effect. D) L would shift to the left. Show Answer Correct Answer: A) There would be a movement down along L. 13. A leftward shift of the supply curve for avocados ( a normal good) might be caused by: A) An increase in consumer incomes. B) An improvement in avocado picking techniques. C) A news report stating that avocados are associated with good health. D) A decrease in the wages that must be paid to avocado pickers. E) Some avocado farmers leaving the market. Show Answer Correct Answer: E) Some avocado farmers leaving the market. 14. Which of the following is not a part of current account? A) Export of goods. B) Imports of services. C) Grants and gifts. D) FDI. Show Answer Correct Answer: D) FDI. 15. When each worker performs a specific task in production A) Scarcity. B) Specialization. C) Opportunity Cost. D) Voluntary Exchange. Show Answer Correct Answer: B) Specialization. 16. Who is involved with fiscal policy? A) The Federal Reserve. B) The President and Congress. C) Banks. D) Suppliers and buyers. Show Answer Correct Answer: B) The President and Congress. 17. Deficit spending occurs within the government, when the amount of money being spent is ..... than amount of tax revenue being collected. A) Less. B) More. C) Equal to. D) None of above. Show Answer Correct Answer: B) More. 18. ..... means total of real production of final goods and services available in the country. A) Aggregate demand. B) Aggregate supply. C) Inflation. D) Unemployment. Show Answer Correct Answer: B) Aggregate supply. 19. Intergovernmental Revenues gives tax money to? A) National Government. B) State and Local. C) Local Only. D) State Only. Show Answer Correct Answer: B) State and Local. 20. A situation in which a maximum price is set is referred to as A) A price floor. B) A price ceiling. C) A surplus. D) A shortage. Show Answer Correct Answer: B) A price ceiling. 21. Yes or No.Looking at the expenditure approach, are the expenses of Filipino overseas worker included in our GDP? A) No. B) Yes. Show Answer Correct Answer: A) No. 22. Collective bargaining is the A) Idea that laborers acting together have greater success in negotiating with management. B) Practice used by employers to get the cheapest labor possible. C) Practice used by employers to hire groups of laborers. D) Idea that laborers working in groups are more productive in the workplace. Show Answer Correct Answer: A) Idea that laborers acting together have greater success in negotiating with management. 23. The Federal Reserve influences banking in all of the following ways EXCEPT: A) Controlling the amount of money in circulation. B) Controlling the interest rates at which banks borrow money. C) Regulating how much money banks must keep on hand, or in reserve. D) Monitoring how federal agencies use tax dollars. Show Answer Correct Answer: D) Monitoring how federal agencies use tax dollars. 24. The division of the United States Treasury that is charged with the responsibility of maintaining confidence in and managing the federal tax system is called the A) President. B) Congress. C) Internal Revenue Service. D) Department of Justice. Show Answer Correct Answer: C) Internal Revenue Service. 25. What does it mean when the demand for a product is inelastic A) Consumers will not buy any of the product when the price rises. B) A price increase does not have a significant impact on demand from the consumer. C) Consumers are sensitive to a change in the price of a product they consume. D) There are few acceptable substitutes for the product that the consumer wants to purchase. Show Answer Correct Answer: B) A price increase does not have a significant impact on demand from the consumer. 26. The ..... is a hypothetical market that brings together those who want to lend money and those who want to borrow money. A) Loanable Funds Market. B) Crowding Out. C) Rate of Return Market. D) Supply and Demand Market. Show Answer Correct Answer: A) Loanable Funds Market. 27. To implement expansionary fiscal policy, the government is likely to A) Cut both taxes and spending. B) Increase both taxes and spending. C) Cut taxes and increase spending. D) Increase taxes and cut spending. Show Answer Correct Answer: C) Cut taxes and increase spending. 28. Assuming there is perfect capital mobility, compared to a large open economy, a small open economy is one in which the: A) Domestic interest rate equals the world interest rate. B) Exchange rate is floating. C) Exchange rate is fixed. D) Domestic interest rate is not equal to the world interest rate. Show Answer Correct Answer: A) Domestic interest rate equals the world interest rate. 29. In the Mundell-Fleming model: A) The exchange rate system must have a fixed exchange rate. B) The exchange rate system must have a floating exchange rate. C) It makes no difference whether the exchange rate system has a floating or a fixed exchange rate. D) The behavior of the economy depends on whether the exchange rate system has a floating or a fixed exchange rate. Show Answer Correct Answer: D) The behavior of the economy depends on whether the exchange rate system has a floating or a fixed exchange rate. 30. In order to achieve the goals of maximum employment and stable prices the Fed targets which variable in the U.S. economy? A) Interest rates. B) Unemployment. C) The foreign exchange market. D) Taxes and government spending. Show Answer Correct Answer: A) Interest rates. ← 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