This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 58 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 58 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which country is NOT in the "fragile five" ? A) India. B) Brazil. C) Turkey. D) Canada. Show Answer Correct Answer: D) Canada. 2. Policy at the federal level refers to legislation, passed by Congress and signed into law by the President, changing levels of taxation and/or government spending to stabilize the economy A) Monetary. B) Fiscal. Show Answer Correct Answer: B) Fiscal. 3. This happens when there is an increase in the production of goods and services. A) Economic Progress. B) Economic Development. C) Economic efficiency. D) Economic Growth. Show Answer Correct Answer: D) Economic Growth. 4. Instead of "entrepreneurship" as one of the 4 factors of production this word is often used A) Technology. B) Transportation. C) Mrs. Dame rocks. D) Instagram. Show Answer Correct Answer: A) Technology. 5. Who gets hurt the most by unexpected inflation? A) Borrowers. B) Lenders/Creditors. C) Consumers. D) Businesses. Show Answer Correct Answer: B) Lenders/Creditors. 6. There is an inverse relationship between the price level and real gross domestic product (RGDP) in aggregate demand. True/False A) False. B) True. Show Answer Correct Answer: B) True. 7. ..... the comparison among producers of a good according to their opportunity cost A) Opportunity Cost. B) Comparative advantage. C) Trade. D) None of above. Show Answer Correct Answer: B) Comparative advantage. 8. The ..... emphasizes the positive relationship between the price level and the money supply, and relies on the velocity equation (M x V = P x Y) A) Rational Expectations. B) Supply Theory of Money. C) Quantity Theory of Money. D) Monetary Policy Rule. Show Answer Correct Answer: C) Quantity Theory of Money. 9. What is a leakage? A) Money that is spent on dumb things. B) Things that relate to water in the economy. C) Things that stop economic growth e.g taxation, imports, savings. D) None of the above. Show Answer Correct Answer: C) Things that stop economic growth e.g taxation, imports, savings. 10. What exists in a highly competitive market but not in monopoly? A) Product differentiation. B) Many sellers. C) Barriers to entry. D) Economies of scale. Show Answer Correct Answer: B) Many sellers. 11. Which is TRUE regarding interest rates? A) The FED cannot adjust interest rates. B) Interest rates and Price Level are inversely related. C) Interest rates and Investment are inversely related. D) Increase in interest rates increases government spending. Show Answer Correct Answer: C) Interest rates and Investment are inversely related. 12. The United States prohibited all imports and exports to and from Cuba in the 1960s. A) Tariff. B) Quota. C) Embargo. D) None of above. Show Answer Correct Answer: C) Embargo. 13. Which group conducts fiscal policy through taxation and spending to influence the economy? A) The Federal Government. B) The Federal Reserve. Show Answer Correct Answer: A) The Federal Government. 14. What would the Federal Reserve do if it wanted to stimulate the U.S. economy & reduce unemployment? A) Decrease the discount rate it charges banks, which would increase the money supply. B) Cause interest rates to rise because high interest rates bring more money into the economy. C) Increase consumer spending by reducing the money supply. D) Cause interest rates to decrease because low interest rates encourage business growth & expansion. Show Answer Correct Answer: D) Cause interest rates to decrease because low interest rates encourage business growth & expansion. 15. Macroeconomics focuses on all of the following except: A) Unemployment problem. B) Inflation in the economy. C) Aggregate demand. D) Jute industry. Show Answer Correct Answer: D) Jute industry. 16. In the AS/AD model, which causes a rightward shift of LRAS? A) Increased population and productivity. B) Increased consumption. C) Increased government transfers. D) Decreased taxes. Show Answer Correct Answer: A) Increased population and productivity. 17. Calculated by dividing the GDP by the country's population. Gives an idea of how successful a country feels to it's citizens. A) Import. B) GDP per capita. C) Export. D) Economy. Show Answer Correct Answer: B) GDP per capita. 18. CLOTH LYING UNSOLD WITH THE TRADER AT THE END OF ACCOUNTING YEAR A) INTERMEDIATE GOOD. B) DURABLE CONSUMER GOOD. C) CONSUMER GOOD. D) CAPITAL GOOD. Show Answer Correct Answer: D) CAPITAL GOOD. 19. The employment rate is the number of people employed divided by number of people in the labor force. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 20. What will happen to interest rate when money supply increases? A) Increase. B) Decrease. C) Indeterminate. D) None of above. Show Answer Correct Answer: B) Decrease. 21. The misperceptions theory explains why the long-run aggregate-supply curve is downward sloping A) False. B) True. Show Answer Correct Answer: A) False. 22. One of the following causes the demand curve shift to the right A) Decrease in government spending. B) High interest rates. C) No correct answer. D) Future confidence in the economy. Show Answer Correct Answer: D) Future confidence in the economy. 23. What is capitalism? A) An economic system that discourages complete economic growth. B) An economic system where all resources are equally distributed among the population. C) An economic system where individuals and private businesses own and control the factors of production. D) An economic system where government owns and controls all businesses. Show Answer Correct Answer: C) An economic system where individuals and private businesses own and control the factors of production. 24. All other things being equal, the long-run aggregate supply curve of an economy is likely to shift to the right if there is an increase in A) Raw material prices. B) Indirect taxation. C) Wage rates. D) Factor mobility. Show Answer Correct Answer: D) Factor mobility. 25. Which one of the following statements best describe why the aggregate supply (AS) curve slopes upward? A) As inflation rises, consumers will want to spend more. B) As firms run into "bottlenecks" in the supply of some resources, they will bid prices up more quickly, causing inflation to rise. C) As inflation rises, firms will be less likely to undertake new investments. D) As output rises, the Fed will allow inflation to rise. E) As inflation rises, the government responds with tax cuts. Show Answer Correct Answer: B) As firms run into "bottlenecks" in the supply of some resources, they will bid prices up more quickly, causing inflation to rise. 26. Macroeconomics approaches the study of economics from the viewpoints of A) Individual firms. B) The entire economy. C) Individual consumers. D) Government units. Show Answer Correct Answer: B) The entire economy. 27. How the changes in AD curve lead to the changes in LM curve? A) When AD curve shift to the right, price will increase, real wealth and real money balance will drop. B) When AD curve shift to the right, price will increase, consumption will reduce, money demand fall. C) When AD curve shift to the left, price will drop, nominal wage drop. D) When AD curve shift to the left, price will drop, nominal wage drop, money demand increase. Show Answer Correct Answer: A) When AD curve shift to the right, price will increase, real wealth and real money balance will drop. 28. "Pigouvian effect" is: A) The situation where the consumption increase when the price falls. B) Known as the effect of real money balance or wealth on equilibrium in IS-LM model. C) The situation where the consumption increase when the wealth increases. D) All of the above. Show Answer Correct Answer: D) All of the above. 29. Which of the following is LEAST likely to be associated with a higher rate of economic growth? A) Strong protection of property rights. B) Encouraging the replenishment of natural resources. C) Higher consumption. D) Taxes on savings and investment. E) Policies that discourage immigration. Show Answer Correct Answer: C) Higher consumption. 30. The law of Demand states that the higher the price the lower the quantity demanded, true or false? 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