Question 1

International per capita GDP comparisons are misleading when countries involved differ greatly in

Accepted Answer

A)  the type of economic system each country uses to solve its economic problem. 
B)  the freedom of their election processes. 
C)  the percentage of economic activity that is transacted in organized markets. 
D)  the quantity of human and natural resources they possess. 
A)  the type of economic system each country uses to solve its economic problem. 
B)  the freedom of their election processes. 
C)  the percentage of economic activity that is transacted in organized markets. 
D)  the quantity of human and natural resources they possess.

Question 2

Gross domestic product accurately measures the environmental costs of producing all goods and services.

Accepted Answer

A) True 
 B)False

Question 3

Aggregate demand and supply curves have been widely used to analyze the performance of the macroeconomy. Figure 5-3 shows four diagrams that represent different changes in the macroeconomy. Choose the diagram that best represents the situations described in the following questions. Figure 5-3  
 
Which graph in Figure 5-3 best represents the economic conditions of the American economy in 2001?

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
A)  1 
B)  2 
C)  3 
D)  4

Question 4

The first year of the Bush administration in 2001 could be represented as a(n)

Accepted Answer

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

Question 5

Since countries differ in the amount of economic activity that is transacted in organized markets,

Accepted Answer

A)  some countries are more productive than others. 
B)  persons live better in some countries than others. 
C)  international comparisons of per capita GDP are often misleading. 
D)  comparisons between countries are totally impossible. 
A)  some countries are more productive than others. 
B)  persons live better in some countries than others. 
C)  international comparisons of per capita GDP are often misleading. 
D)  comparisons between countries are totally impossible.

Question 6

Nominal GDP is calculated by using

Accepted Answer

A)  prices set in a base year. 
B)  average prices in all major cities. 
C)  current prices. 
D)  prices charged by initial producers. 
A)  prices set in a base year. 
B)  average prices in all major cities. 
C)  current prices. 
D)  prices charged by initial producers.

Question 7

If aggregate demand shifts outward over a long period of time, with aggregate supply held constant, the economy should experience

Accepted Answer

A)  unemployment. 
B)  recession. 
C)  budget surpluses. 
D)  inflation. 
A)  unemployment. 
B)  recession. 
C)  budget surpluses. 
D)  inflation.

Question 8

John Maynard Keynes wrote that economies can suffer recession or depression for many years if the government does not intervene.

Accepted Answer

A) True 
 B)False

Question 9

E&S Cooling Co. installs air conditioning systems in new houses for homebuilders and replacement systems for homeowners. Sales of which systems are included in this year's GDP?

Accepted Answer

A)  Sales of replacement systems 
B)  Sales of both systems 
C)  Sales of systems in new houses 
D)  Neither system would be included, because they are always intermediate goods 
A)  Sales of replacement systems 
B)  Sales of both systems 
C)  Sales of systems in new houses 
D)  Neither system would be included, because they are always intermediate goods

Question 10

In 2008, you buy a 1967 Shelby cobra. This purchase would

Accepted Answer

A)  be included in the GDP for 2008. 
B)  not be included in the GDP for 2008. 
C)  be included in both the GDP for 1967 and 2008. 
D)  be in the GDP for 2008 at a depreciated value. 
A)  be included in the GDP for 2008. 
B)  not be included in the GDP for 2008. 
C)  be included in both the GDP for 1967 and 2008. 
D)  be in the GDP for 2008 at a depreciated value.

Question 11

Economist John Maynard Keynes wrote that recessions can be prolonged and interminable; therefore, government action is needed to jump-start the economy.

Accepted Answer

A) True 
 B)False

Question 12

GDP consistently measures the output of goods and services in all countries.

Accepted Answer

A) True 
 B)False

Question 13

Two of the most important macroeconomic issues are unemployment and inflation.

Accepted Answer

A) True 
 B)False

Question 14

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 15

Gross domestic product is a monetary measure of

Accepted Answer

A)  total consumption in the economy. 
B)  the total value of all final goods and services. 
C)  total industrial output. 
D)  the total value of all foreign sales and purchases. 
A)  total consumption in the economy. 
B)  the total value of all final goods and services. 
C)  total industrial output. 
D)  the total value of all foreign sales and purchases.

Question 16

The horizontal axis on the aggregate demand-aggregate supply model measures

Accepted Answer

A)  the price of the specific product produced. 
B)  the level of total output. 
C)  the price level. 
D)  the level of employment. 
A)  the price of the specific product produced. 
B)  the level of total output. 
C)  the price level. 
D)  the level of employment.

Question 17

If aggregate demand shifts outward, the result will be inflation.

Accepted Answer

A) True 
 B)False

Question 18

The main reason that President Clinton was forced to revise his campaign promise to cut taxes was that, in 1993, he faced a large

Accepted Answer

A)  balance of payments surplus. 
B)  balance of payments deficit. 
C)  federal budget deficit. 
D)  federal budget surplus. 
A)  balance of payments surplus. 
B)  balance of payments deficit. 
C)  federal budget deficit. 
D)  federal budget surplus.

Question 19

Fiscal policy and monetary policy are economic stabilization policies designed to

Accepted Answer

A)  prolong recessions. 
B)  prolong inflation. 
C)  stabilize prices. 
D)  decrease employment. 
A)  prolong recessions. 
B)  prolong inflation. 
C)  stabilize prices. 
D)  decrease employment.

Question 20

Cars produced by General Motors in Mexico would be included in U.S. Gross domestic product.

Accepted Answer

A) True 
 B)False

International per capita GDP comparisons are misleading when countries involved differ greatly in

Gross domestic product accurately measures the environmental costs of producing all goods and services.

The first year of the Bush administration in 2001 could be represented as a(n)

Since countries differ in the amount of economic activity that is transacted in organized markets,

Nominal GDP is calculated by using

If aggregate demand shifts outward over a long period of time, with aggregate supply held constant, the economy should experience

John Maynard Keynes wrote that economies can suffer recession or depression for many years if the government does not intervene.

E&S Cooling Co. installs air conditioning systems in new houses for homebuilders and replacement systems for homeowners. Sales of which systems are included in this year's GDP?

In 2008, you buy a 1967 Shelby cobra. This purchase would

Economist John Maynard Keynes wrote that recessions can be prolonged and interminable; therefore, government action is needed to jump-start the economy.

GDP consistently measures the output of goods and services in all countries.

Two of the most important macroeconomic issues are unemployment and inflation.

Economists define an aggregate as

Gross domestic product is a monetary measure of

The horizontal axis on the aggregate demand-aggregate supply model measures

If aggregate demand shifts outward, the result will be inflation.

The main reason that President Clinton was forced to revise his campaign promise to cut taxes was that, in 1993, he faced a large

Fiscal policy and monetary policy are economic stabilization policies designed to

Cars produced by General Motors in Mexico would be included in U.S. Gross domestic product.

What Is Economics

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

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 Us Economy

Filters

Exam 21: An Introduction to Macroeconomics

International per capita GDP comparisons are misleading when countries involved differ greatly in

Gross domestic product accurately measures the environmental costs of producing all goods and services.

The first year of the Bush administration in 2001 could be represented as a(n)

Since countries differ in the amount of economic activity that is transacted in organized markets,

Nominal GDP is calculated by using

If aggregate demand shifts outward over a long period of time, with aggregate supply held constant, the economy should experience

John Maynard Keynes wrote that economies can suffer recession or depression for many years if the government does not intervene.

E&S Cooling Co. installs air conditioning systems in new houses for homebuilders and replacement systems for homeowners. Sales of which systems are included in this year's GDP?

In 2008, you buy a 1967 Shelby cobra. This purchase would

Economist John Maynard Keynes wrote that recessions can be prolonged and interminable; therefore, government action is needed to jump-start the economy.

GDP consistently measures the output of goods and services in all countries.

Two of the most important macroeconomic issues are unemployment and inflation.

Economists define an aggregate as

Gross domestic product is a monetary measure of

The horizontal axis on the aggregate demand-aggregate supply model measures

If aggregate demand shifts outward, the result will be inflation.

The main reason that President Clinton was forced to revise his campaign promise to cut taxes was that, in 1993, he faced a large

Fiscal policy and monetary policy are economic stabilization policies designed to

Cars produced by General Motors in Mexico would be included in U.S. Gross domestic product.

What Is Economics

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

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 Us Economy

Filters