Question 1

If the real GDP of a country in 2011 was 300 billion, its price index was 108.3, and its population was 150 billion, then real GDP per capita for that year was:

Accepted Answer

A)  0.5 billion. 
B)  1 billion. 
C)  8.3 billion. 
D)  258.3 billion. 
E)  2 billion. 
A)  0.5 billion. 
B)  1 billion. 
C)  8.3 billion. 
D)  258.3 billion. 
E)  2 billion.

Question 2

An economic variable that is measured per unit of time, such as spending per year, is known as a:

Accepted Answer

A)  stock variable. 
B)  periodic variable. 
C)  dummy variable. 
D)  flow variable. 
E)  controlled variable. 
A)  stock variable. 
B)  periodic variable. 
C)  dummy variable. 
D)  flow variable. 
E)  controlled variable.

Question 3

Suppose an economy is initially in equilibrium and there is a sudden increase in oil prices. Which of the following is the most likely result?

Accepted Answer

A)  Growth in real GDP 
B)  Price stability 
C)  Full employment output 
D)  Stagflation 
E)  Deflation 
A)  Growth in real GDP 
B)  Price stability 
C)  Full employment output 
D)  Stagflation 
E)  Deflation

Question 4

Which of the following economic measures is most useful in comparing different economies across the world?

Accepted Answer

A)  Aggregate supply 
B)  Total unemployment 
C)  Gross domestic product 
D)  Net national product 
E)  Aggregate expenditure 
A)  Aggregate supply 
B)  Total unemployment 
C)  Gross domestic product 
D)  Net national product 
E)  Aggregate expenditure

Question 5

Which of the following statements regarding the gross domestic product is true?

Accepted Answer

A)  It is useful in comparing the overall performance of different economies at the same time. 
B)  It measures aggregate income in an economy over a period of ten years. 
C)  It measures the value of all goods and services produced in the world during a given period. 
D)  It is a measure of an economy's price level during a particular year. 
E)  It records the cumulative value of all goods and services produced by domestically owned factors of production. 
A)  It is useful in comparing the overall performance of different economies at the same time. 
B)  It measures aggregate income in an economy over a period of ten years. 
C)  It measures the value of all goods and services produced in the world during a given period. 
D)  It is a measure of an economy's price level during a particular year. 
E)  It records the cumulative value of all goods and services produced by domestically owned factors of production.

Question 6

If the price level in the U.S. increases, aggregate output demanded:

Accepted Answer

A)  decreases because U.S. products become cheaper relative to foreign products. 
B)  decreases because U.S. products become more expensive relative to foreign products. 
C)  increases because U.S. products become cheaper relative to foreign products. 
D)  increases because U.S. products become more expensive relative to foreign products. 
E)  decreases because household wealth and spending increase. 
A)  decreases because U.S. products become cheaper relative to foreign products. 
B)  decreases because U.S. products become more expensive relative to foreign products. 
C)  increases because U.S. products become cheaper relative to foreign products. 
D)  increases because U.S. products become more expensive relative to foreign products. 
E)  decreases because household wealth and spending increase.

Question 7

Which of these faulty economic policies was adopted by President Hoover during the Great Depression?

Accepted Answer

A)  An increase in tax rate 
B)  An increase in trade barriers 
C)  A decrease in tax rate 
D)  A decrease in government spending 
E)  An increase in government spending 
A)  An increase in tax rate 
B)  An increase in trade barriers 
C)  A decrease in tax rate 
D)  A decrease in government spending 
E)  An increase in government spending

Question 8

Which of the following decades is known as the "Golden Age of Keynesian Economics"?

Accepted Answer

A)  The 1930s 
B)  The 1950s 
C)  The 1960s 
D)  The 1970s 
E)  The 1980s 
A)  The 1930s 
B)  The 1950s 
C)  The 1960s 
D)  The 1970s 
E)  The 1980s

Question 9

Which of the following is the significance of a country's price index?

Accepted Answer

A)  It helps in measuring changes in the nominal interest rate in a country. 
B)  It helps in measuring the total disposable income of a country. 
C)  It helps in determining a country's real GDP each year. 
D)  It helps in measuring changes in the prices of only luxury goods. 
E)  It helps in measuring the demand for goods and services exported by a country. 
A)  It helps in measuring changes in the nominal interest rate in a country. 
B)  It helps in measuring the total disposable income of a country. 
C)  It helps in determining a country's real GDP each year. 
D)  It helps in measuring changes in the prices of only luxury goods. 
E)  It helps in measuring the demand for goods and services exported by a country.

Question 10

Which of these changes was observed in the U.S. between 1929 and 1933?

Accepted Answer

A)  The aggregate supply curve shifted inward with no change in the aggregate demand curve. 
B)  The aggregate demand curve shifted inward with no change in the aggregate supply curve. 
C)  The aggregate demand curve shifted outward with no change in the aggregate supply curve. 
D)  The aggregate supply curve shifted outward with no change in the aggregate demand curve. 
E)  The aggregate supply and demand curves both shifted outward. 
A)  The aggregate supply curve shifted inward with no change in the aggregate demand curve. 
B)  The aggregate demand curve shifted inward with no change in the aggregate supply curve. 
C)  The aggregate demand curve shifted outward with no change in the aggregate supply curve. 
D)  The aggregate supply curve shifted outward with no change in the aggregate demand curve. 
E)  The aggregate supply and demand curves both shifted outward.

Question 11

The gross domestic product measures the value of all final goods and services produced by resources owned by a nation.

Accepted Answer

A) True 
 B)False

Question 12

Since the Great Depression, business fluctuations have become more severe and longer in duration.

Accepted Answer

A) True 
 B)False

Question 13

Economists use the price index to eliminate year-to-year changes in GDP due solely to changes in:

Accepted Answer

A)  the exchange rate. 
B)  the unemployment rate. 
C)  fiscal spending. 
D)  consumer demand. 
E)  the price level. 
A)  the exchange rate. 
B)  the unemployment rate. 
C)  fiscal spending. 
D)  consumer demand. 
E)  the price level.

Question 14

Macroeconomic equilibrium is best described as a situation in which:

Accepted Answer

A)  the slope of the aggregate demand curve equals the slope of the aggregate supply curve. 
B)  quantity demanded exceeds quantity supplied. 
C)  quantity demanded equals quantity supplied at a unique price level. 
D)  quantity supplied exceeds quantity demanded at a unique price level. 
E)  quantity supplied equals quantity demanded at a unique price level. 
A)  the slope of the aggregate demand curve equals the slope of the aggregate supply curve. 
B)  quantity demanded exceeds quantity supplied. 
C)  quantity demanded equals quantity supplied at a unique price level. 
D)  quantity supplied exceeds quantity demanded at a unique price level. 
E)  quantity supplied equals quantity demanded at a unique price level.

Question 15

The figure below shows the aggregate demand and supply curves for the U.S. A rightward shift of the aggregate supply curve from AS to AS' would be caused by:

Accepted Answer

A)  an increase in resource prices, improved technology, or an extension of patent protection. 
B)  a decrease in resource prices, improved technology, or an extension of patent protection. 
C)  a decrease in resource prices, improved technology, or a shortening of patent protection. 
D)  an appreciation of the dollar, higher inflation in Europe, or a decrease in resource prices. 
E)  a depreciation of the dollar, higher inflation in Asia, or improved technology. 
A)  an increase in resource prices, improved technology, or an extension of patent protection. 
B)  a decrease in resource prices, improved technology, or an extension of patent protection. 
C)  a decrease in resource prices, improved technology, or a shortening of patent protection. 
D)  an appreciation of the dollar, higher inflation in Europe, or a decrease in resource prices. 
E)  a depreciation of the dollar, higher inflation in Asia, or improved technology.

Question 16

Which of the following can be concluded about the long-run performance of the U.S. economy?

Accepted Answer

A)  It has been able to create employment opportunities but only at the cost of high inflation. 
B)  It has failed to generate sufficient aggregate demand in the economy. 
C)  It has been one of the most productive economies in the world in terms of growth in real GDP. 
D)  It has focused fiscal policies mostly at improving aggregate supply. 
E)  It has suffered from huge fiscal deficits that dampened economic growth. 
A)  It has been able to create employment opportunities but only at the cost of high inflation. 
B)  It has failed to generate sufficient aggregate demand in the economy. 
C)  It has been one of the most productive economies in the world in terms of growth in real GDP. 
D)  It has focused fiscal policies mostly at improving aggregate supply. 
E)  It has suffered from huge fiscal deficits that dampened economic growth.

Question 17

Which of the following was true of the U.S. job market between 1929 and 2011?

Accepted Answer

A)  The number of jobs created in the organized sector was less than that in the unorganized sector. 
B)  The number employed people increased by less than five percent. 
C)  The average education of workers increased over the years. 
D)  The productivity of workers declined over the years. 
E)  The growth in employment opportunities was slower compared to the growth in population. 
A)  The number of jobs created in the organized sector was less than that in the unorganized sector. 
B)  The number employed people increased by less than five percent. 
C)  The average education of workers increased over the years. 
D)  The productivity of workers declined over the years. 
E)  The growth in employment opportunities was slower compared to the growth in population.

Question 18

The figure below shows the aggregate demand and supply curves for the U.S. The figure given below shows that the price level changes from _____ when the aggregate supply curve shifts from AS' to AS''.

Accepted Answer

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

Question 19

For a given aggregate supply curve, price level and output will both increase when aggregate demand decreases.

Accepted Answer

A) True 
 B)False

Question 20

Stagflation is a situation with high unemployment rates, high inflation rates, and little or no growth in the economy.

Accepted Answer

A) True 
 B)False

If the real GDP of a country in 2011 was 300 billion, its price index was 108.3, and its population was 150 billion, then real GDP per capita for that year was:

An economic variable that is measured per unit of time, such as spending per year, is known as a:

Suppose an economy is initially in equilibrium and there is a sudden increase in oil prices. Which of the following is the most likely result?

Which of the following economic measures is most useful in comparing different economies across the world?

Which of the following statements regarding the gross domestic product is true?

If the price level in the U.S. increases, aggregate output demanded:

Which of these faulty economic policies was adopted by President Hoover during the Great Depression?

Which of the following decades is known as the "Golden Age of Keynesian Economics"?

Which of the following is the significance of a country's price index?

Which of these changes was observed in the U.S. between 1929 and 1933?

The gross domestic product measures the value of all final goods and services produced by resources owned by a nation.

Since the Great Depression, business fluctuations have become more severe and longer in duration.

Economists use the price index to eliminate year-to-year changes in GDP due solely to changes in:

Macroeconomic equilibrium is best described as a situation in which:

The figure below shows the aggregate demand and supply curves for the U.S. A rightward shift of the aggregate supply curve from AS to AS' would be caused by:

Which of the following can be concluded about the long-run performance of the U.S. economy?

Which of the following was true of the U.S. job market between 1929 and 2011?

The figure below shows the aggregate demand and supply curves for the U.S. The figure given below shows that the price level changes from _____ when the aggregate supply curve shifts from AS' to AS''.

For a given aggregate supply curve, price level and output will both increase when aggregate demand decreases.

Stagflation is a situation with high unemployment rates, high inflation rates, and little or no growth in the economy.

The Art and Science of Economic Analysis

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters

Exam 5: Introduction to Macroeconomics

If the real GDP of a country in 2011 was 300 billion, its price index was 108.3, and its population was 150 billion, then real GDP per capita for that year was:

An economic variable that is measured per unit of time, such as spending per year, is known as a:

Suppose an economy is initially in equilibrium and there is a sudden increase in oil prices. Which of the following is the most likely result?

Which of the following economic measures is most useful in comparing different economies across the world?

Which of the following statements regarding the gross domestic product is true?

If the price level in the U.S. increases, aggregate output demanded:

Which of these faulty economic policies was adopted by President Hoover during the Great Depression?

Which of the following decades is known as the "Golden Age of Keynesian Economics"?

Which of the following is the significance of a country's price index?

Which of these changes was observed in the U.S. between 1929 and 1933?

The gross domestic product measures the value of all final goods and services produced by resources owned by a nation.

Since the Great Depression, business fluctuations have become more severe and longer in duration.

Economists use the price index to eliminate year-to-year changes in GDP due solely to changes in:

Macroeconomic equilibrium is best described as a situation in which:

The figure below shows the aggregate demand and supply curves for the U.S. A rightward shift of the aggregate supply curve from AS to AS' would be caused by:

Which of the following can be concluded about the long-run performance of the U.S. economy?

Which of the following was true of the U.S. job market between 1929 and 2011?

The figure below shows the aggregate demand and supply curves for the U.S. The figure given below shows that the price level changes from _____ when the aggregate supply curve shifts from AS' to AS''.

For a given aggregate supply curve, price level and output will both increase when aggregate demand decreases.

Stagflation is a situation with high unemployment rates, high inflation rates, and little or no growth in the economy.

The Art and Science of Economic Analysis

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters