Question 1

You won the lottery in 2006 for $22 million and gave your sister $500,000.Your winning contributed how much to GDP?

Accepted Answer

A) $500,000 
B) $22 million 
C) $0 
D) $21.5 million 
A) $500,000 
B) $22 million 
C) $0 
D) $21.5 million

Question 2

Nominal GDP is another term for

Accepted Answer

A) current dollar GDP. 
B) constant dollar GDP. 
C) adjusted dollar GDP. 
D) relative value GDP. 
A) current dollar GDP. 
B) constant dollar GDP. 
C) adjusted dollar GDP. 
D) relative value GDP.

Question 3

To fight inflation, the government may

Accepted Answer

A) decrease aggregate demand, which will also lead to lower unemployment rates. 
B) increase aggregate demand, which will also lead to lower unemployment rates. 
C) increase aggregate demand, which will also lead to higher unemployment rates. 
D) decrease aggregate demand, which will also lead to higher unemployment rates. 
A) decrease aggregate demand, which will also lead to lower unemployment rates. 
B) increase aggregate demand, which will also lead to lower unemployment rates. 
C) increase aggregate demand, which will also lead to higher unemployment rates. 
D) decrease aggregate demand, which will also lead to higher unemployment rates.

Question 4

Real GDP

Accepted Answer

A) is GDP adjusted for changes in the price level. 
B) is also called nominal GDP. 
C) measures GDP minus depreciation of capital. 
D) will always change when prices change. 
A) is GDP adjusted for changes in the price level. 
B) is also called nominal GDP. 
C) measures GDP minus depreciation of capital. 
D) will always change when prices change.

Question 5

If a macroeconomist aggregates many markets into one, then

Accepted Answer

A) individual market differences are eliminated. 
B) one must not confuse ravioli and hotdogs. 
C) she is performing a meaningless exercise. 
D) differences between products must still be noted. 
A) individual market differences are eliminated. 
B) one must not confuse ravioli and hotdogs. 
C) she is performing a meaningless exercise. 
D) differences between products must still be noted.

Question 6

One of the initial problems facing the newly elected President Clinton was a large budget deficit.

Accepted Answer

A) True 
 B)False

Question 7

If hotdogs cost $2 this year and $3 next year, then 100 hotdogs will contribute

Accepted Answer

A) $200 to this year's nominal GDP and $166 to next year's nominal GDP. 
B) $200 to this year's real GDP and $300 to next year's real GDP. 
C) the same dollar amount to each year's nominal GDP because hotdogs are intermediate goods. 
D) $200 to this year's nominal GDP and $300 to next year's nominal GDP. 
A) $200 to this year's nominal GDP and $166 to next year's nominal GDP. 
B) $200 to this year's real GDP and $300 to next year's real GDP. 
C) the same dollar amount to each year's nominal GDP because hotdogs are intermediate goods. 
D) $200 to this year's nominal GDP and $300 to next year's nominal GDP.

Question 8

The tax cut of 2001 turned out to be well-timed because it caused a

Accepted Answer

A) rightward shift of the aggregate demand curve. 
B) rightward shift of the aggregate supply curve. 
C) leftward shift of the aggregate demand curve. 
D) leftward shift of the aggregate supply curve. 
A) rightward shift of the aggregate demand curve. 
B) rightward shift of the aggregate supply curve. 
C) leftward shift of the aggregate demand curve. 
D) leftward shift of the aggregate supply curve.

Question 9

Donald Trump's first years in office could be illustrated by an

Accepted Answer

A) increase in aggregate demand. 
B) increase in aggregate supply. 
C) decrease in aggregate demand. 
D) decrease in aggregate supply. 
A) increase in aggregate demand. 
B) increase in aggregate supply. 
C) decrease in aggregate demand. 
D) decrease in aggregate supply.

Question 10

Trish grows oregano in her backyard to use in her homemade pesto sauce.How is this gardening included in GDP?

Accepted Answer

A) It is included in real GDP. 
B) It is included in nominal GDP. 
C) It is not included in GDP. 
D) It is included as an intermediate good. 
A) It is included in real GDP. 
B) It is included in nominal GDP. 
C) It is not included in GDP. 
D) It is included as an intermediate good.

Question 11

According to Keynes, a pessimistic outlook causes consumers and businesspersons to ____, and a recession could occur.

Accepted Answer

A) increase planned investment 
B) decrease planned spending 
C) increase exports 
D) decrease imports 
E) decrease saving 
A) increase planned investment 
B) decrease planned spending 
C) increase exports 
D) decrease imports 
E) decrease saving

Question 12

The movements of real GDP and inflation during the 1973-1975 recession can be best explained by a

Accepted Answer

A) rightward shift of the aggregate demand curve. 
B) leftward shift of the aggregate demand curve. 
C) rightward shift of the aggregate supply curve. 
D) leftward shift of the aggregate supply curve. 
A) rightward shift of the aggregate demand curve. 
B) leftward shift of the aggregate demand curve. 
C) rightward shift of the aggregate supply curve. 
D) leftward shift of the aggregate supply curve.

Question 13

Economists define an aggregate as

Accepted Answer

A) a concrete object. 
B) a specific principle. 
C) a representative good or service. 
D) a useful abstraction. 
E) something immeasurable. 
A) a concrete object. 
B) a specific principle. 
C) a representative good or service. 
D) a useful abstraction. 
E) something immeasurable.

Question 14

Figure 5-2
​  
-The economy in the period 1950 to 1998 behaved differently than the economy in the 1870 to 1940 time period.Economists explain this difference

Accepted Answer

A) in part because of the use of stabilization policy. 
B) because of increases in U.S.population due to the "baby boom." 
C) in part because of the globalization of the economy. 
D) in part because of the use of competition policy. 
A) in part because of the use of stabilization policy. 
B) because of increases in U.S.population due to the "baby boom." 
C) in part because of the globalization of the economy. 
D) in part because of the use of competition policy.

Question 15

The Great Recession is remembered by most economists as a period of

Accepted Answer

A) hyperinflation. 
B) high rates of unemployment. 
C) price controls and low inflation. 
D) the inability of the Federal Reserve to assist the financial system. 
A) hyperinflation. 
B) high rates of unemployment. 
C) price controls and low inflation. 
D) the inability of the Federal Reserve to assist the financial system.

Question 16

Which of the following is not an abstraction of macroeconomics?

Accepted Answer

A) Inflation rate 
B) Total costs 
C) Unemployment 
D) Aggregate supply 
A) Inflation rate 
B) Total costs 
C) Unemployment 
D) Aggregate supply

Question 17

What makes the macroeconomic performance of the 1993 to 1998 period so unusual is the

Accepted Answer

A) simultaneous occurrence of unemployment and inflation increases. 
B) simultaneous occurrence of real GDP decreases and inflation rate increases. 
C) occurrence of real GDP decreases while the unemployment rate increases. 
D) simultaneous occurrence of reduced unemployment rates and falling inflation rates. 
A) simultaneous occurrence of unemployment and inflation increases. 
B) simultaneous occurrence of real GDP decreases and inflation rate increases. 
C) occurrence of real GDP decreases while the unemployment rate increases. 
D) simultaneous occurrence of reduced unemployment rates and falling inflation rates.

Question 18

Discuss some of the fundamental differences between microeconomics and macroeconomics.

Accepted Answer

Microeconomics studies the decisions of

Question 19

If the prices of all goods and services rise during the year,

Accepted Answer

A) real GDP may fall. 
B) nominal GDP must rise. 
C) nominal GDP may increase. 
D) real GDP must rise. 
A) real GDP may fall. 
B) nominal GDP must rise. 
C) nominal GDP may increase. 
D) real GDP must rise.

Question 20

You are a collector of baseball cards.In 2018, you purchase a Madison Baumgartner baseball card printed in 2012.This baseball card

Accepted Answer

A) is included in the 2012 GDP. 
B) is in the 2012 and 2018 GDP. 
C) excluded from the 2012 GDP. 
D) included in the 2018 GDP. 
A) is included in the 2012 GDP. 
B) is in the 2012 and 2018 GDP. 
C) excluded from the 2012 GDP. 
D) included in the 2018 GDP.

Exam 21: An Introduction to Macroeconomics

You won the lottery in 2006 for $22 million and gave your sister $500,000.Your winning contributed how much to GDP?

Nominal GDP is another term for

To fight inflation, the government may

Real GDP

If a macroeconomist aggregates many markets into one, then

One of the initial problems facing the newly elected President Clinton was a large budget deficit.

If hotdogs cost $2 this year and $3 next year, then 100 hotdogs will contribute

The tax cut of 2001 turned out to be well-timed because it caused a

Donald Trump's first years in office could be illustrated by an

Trish grows oregano in her backyard to use in her homemade pesto sauce.How is this gardening included in GDP?

According to Keynes, a pessimistic outlook causes consumers and businesspersons to ____, and a recession could occur.

The movements of real GDP and inflation during the 1973-1975 recession can be best explained by a

Economists define an aggregate as

Figure 5-2 ​ -The economy in the period 1950 to 1998 behaved differently than the economy in the 1870 to 1940 time period.Economists explain this difference

The Great Recession is remembered by most economists as a period of

Which of the following is not an abstraction of macroeconomics?

What makes the macroeconomic performance of the 1993 to 1998 period so unusual is the

Discuss some of the fundamental differences between microeconomics and macroeconomics.

If the prices of all goods and services rise during the year,

You are a collector of baseball cards.In 2018, you purchase a Madison Baumgartner baseball card printed in 2012.This baseball card

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

Filters

Figure 5-2 -The economy in the period 1950 to 1998 behaved differently than the economy in the 1870 to 1940 time period.Economists explain this difference