This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Macroeconomics – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Macroeconomics Quiz 7 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What are two main monetary tools the government has? A) Government spending and reserve requirement. B) Taxes and government spending. C) Buy/selling bonds and discount rate. D) Discount rate and taxes. Show Answer Correct Answer: B) Taxes and government spending. 2. Studies on individual income. A) Microeconomics. B) Macroeconomics. Show Answer Correct Answer: A) Microeconomics. 3. Unskilled workers often A) Earn the most income. B) Work the most hours for the lowest wage. C) Have the most education and training. D) Need no supervision. Show Answer Correct Answer: B) Work the most hours for the lowest wage. 4. If Americans want to purchase more South Korean cars, the supply of dollars in the foreign exchange market will ..... and demand for the Won, the South Korean currency, will ..... A) Decrease, decrease. B) Increase, increase. C) Increase, decrease. D) Decrease, increase. Show Answer Correct Answer: B) Increase, increase. 5. Samuel Gompers founded an organization that focused on the interests of ..... A) Unskilled workers. B) Skilled workers. C) Contract workers. D) Temporary workers. Show Answer Correct Answer: B) Skilled workers. 6. The major difference between real and nominal gross domestic product (GDP) is that real GDP A) Excludes government transfer payments. B) Excludes imports. C) Is adjusted for price-level changes using a price index. D) Measures only the value of final goods and services that are consumed. E) Measures the prices of a market basket of goods purchased by a typical urban consumer. Show Answer Correct Answer: C) Is adjusted for price-level changes using a price index. 7. The study of how individuals make decisions in the society is what A) Macroeconomics. B) Microeconomics. C) None of the above. D) All of the above. Show Answer Correct Answer: B) Microeconomics. 8. If the federal government simultaneously engages in expansionary monetary and fiscal policies, which of the following is likely to be the effect on interest rates/unemployment? A) Increase/decrease. B) Indeterminate/decrease. C) Indeterminate/increase. D) Increase/indeterminate. E) Decrease/decrease. Show Answer Correct Answer: E) Decrease/decrease. 9. To increase the money supply, the Fed would A) Raise the discount rate. B) Sell bonds. C) Buy bonds. D) Raise the reserve requirement. Show Answer Correct Answer: C) Buy bonds. 10. What are savings? A) The total amount of money spent in a particular period of time. B) A sum of money that is owed to someone else. C) An amount of money that has been leant to someone over a particular period of time to allow them to purchase a product. D) The money someone has not spent, usually through a bank or official scheme. Show Answer Correct Answer: D) The money someone has not spent, usually through a bank or official scheme. 11. M2 can be define as A) M1 plus saving accounts. B) M1 plus all types of deposits. C) M1 plus narrow money. D) M1 plus broads money. Show Answer Correct Answer: C) M1 plus narrow money. 12. What do you know about supply and demand? A) When supply goes up, demand also goes up. B) When supply goes down and demand is high, prices are high. C) When demand is low and supply is high, prices are high. D) None of above. Show Answer Correct Answer: B) When supply goes down and demand is high, prices are high. 13. Which of the following does not describe hyperinflation? A) Germany, Hungary, Bolivia, Ukraine, and Zimbabwe have experienced hyperinflation in the last 100 years. B) During a hyperinflation people often try to shift to a "hard" currency issued by another country. C) The purchasing power of money increases dramatically during hyperinflation. D) Hyperinflation is often defined as an annual inflation rate higher than 100 percent. E) All of these statements are accurate. Show Answer Correct Answer: C) The purchasing power of money increases dramatically during hyperinflation. 14. For all the recent talk of cutting taxes, Congress rarely cuts them when the economy is growing robustly, as it is now, and unemployment is low. The worry among economists is that the extra money in people's pockets may make an already strong economy too strong, finally stoking inflation after a long period of relatively stable prices. (Source:The New York Times, July 14, 1999.) The passage describes rising inflation as a possible result of A) A booming economy. B) Rising unemployment. C) Tax cuts. D) A prolonged period of stable prices. Show Answer Correct Answer: A) A booming economy. 15. ..... occurs when a government deficit drives up the interest rate and leads to reduced investment spending. A) Rate of Return. B) Crowding Out. C) Loanable Funds Market. D) Fisher Effect. Show Answer Correct Answer: B) Crowding Out. 16. When one decision is made, the next best alternative not selected is called A) Opportunity cost. B) Comparative advantage. C) Economic resource. D) Scarcity. Show Answer Correct Answer: A) Opportunity cost. 17. Aggregate demand is the total aggregate output and price level of economy in a given period. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 18. Goods which are meant for consumption purpose are called A) Capital goods. B) Intermediate goods. C) Consumption goods. D) Durable capital goods. Show Answer Correct Answer: C) Consumption goods. 19. Coins in the people pockets are A) Excluded from both M1 and M2. B) Included in both M1 and M2. C) Included in M1, but not in M2. D) Included in M2, but not in M1. Show Answer Correct Answer: B) Included in both M1 and M2. 20. A person who borrows a 30 year fixed rate mortgage is likely to benefit from inflation. True or False? A) True. B) False. Show Answer Correct Answer: A) True. 21. A production possibilities curve can shift outward if: A) Government increases the amount of money in the economy. B) There is technological improvement. C) Resources are shifted from the production of one good to the production of the other good. D) The economy abandons inefficient production methods in favor of efficient production methods. Show Answer Correct Answer: B) There is technological improvement. 22. Your money remains tax-deferred in this account until you withdraw (taxed as income) A) Traditional IRA. B) ROTH IRA. Show Answer Correct Answer: A) Traditional IRA. 23. Has a GDP Per Capita of $ 59, 800 A) Canada. B) United States. Show Answer Correct Answer: B) United States. 24. Choose the CORRECT answer for types of inflation. A) Cost-push inflation, Demand-pull inflation & Imported inflation. B) Aggregate inflation, safe-cost inflation & uncontrollable inflation. C) Marriage inflation, Education inflation & Mobile inflation. D) None of above. Show Answer Correct Answer: A) Cost-push inflation, Demand-pull inflation & Imported inflation. 25. Unemployed due to a downturn in overall economic activity A) Cyclical. B) Seasonal. C) Frictional. D) Structural. Show Answer Correct Answer: A) Cyclical. 26. Which of the following will be counted as unemployed by the US Bureau of Labor Statistics? A) Persons who quit their previous jobs to stay at home to care for sick parents. B) Persons who were laid off from their previous jobs and have not applied for a job in two years. C) Persons who were fired from their previous jobs and are actively looking for work. D) Persons who quit their previous jobs to start their own businesses. Show Answer Correct Answer: C) Persons who were fired from their previous jobs and are actively looking for work. 27. Baron purchases a factory for his sneaker company. The factory is classified as which factor of production? A) Land. B) Labor. C) Capital. D) Entrepreneurship. Show Answer Correct Answer: C) Capital. 28. A public sector option for employment paid at a living wage to anyone willing and able to contribute time to public purpose A) Universal Basic Services (UBS). B) Democratic Socialism. C) Universal Job Guarantee (UJG). D) Universal Basic Income (UBI). Show Answer Correct Answer: C) Universal Job Guarantee (UJG). 29. The total demand for goods and services in the economy. A) Aggregate supply. B) Aggregate demand. Show Answer Correct Answer: B) Aggregate demand. 30. When incidence and burden of tax falls on different persons that type of tax is called: A) Direct tax. B) Indirect tax. C) Regressive tax. D) None of these. Show Answer Correct Answer: B) Indirect tax. ← PreviousNext →Related QuizzesEconomics QuizzesFinance QuizzesMacroeconomics Quiz 1Macroeconomics Quiz 2Macroeconomics Quiz 3Macroeconomics Quiz 4Macroeconomics Quiz 5Macroeconomics Quiz 6Macroeconomics Quiz 8Macroeconomics Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books