Question 1

If the federal government were to run a budget deficit, this would

Accepted Answer

A)  increase the size of the national debt. 
B)  reduce the size of the national debt. 
C)  leave the size of the national debt unchanged. 
D)  increase the national debt only if the government also expands the supply of money. 
A)  increase the size of the national debt. 
B)  reduce the size of the national debt. 
C)  leave the size of the national debt unchanged. 
D)  increase the national debt only if the government also expands the supply of money.

Question 2

What is the index of leading indicators, and what is it used for?

Accepted Answer

The index of leading indicators is a col

Question 3

Which of the following variables are included in the index of leading indicators?

Accepted Answer

A)  new orders placed with manufacturers, length of average workweek, permits for new housing starts 
B)  changes in the M1 money supply, number of new credit cards, political stance of current politicians 
C)  average worker salary, average number of children per family, current standard of living 
D)  labor-force participation rate, household debt as a share of disposable income, the real interest rate 
A)  new orders placed with manufacturers, length of average workweek, permits for new housing starts 
B)  changes in the M1 money supply, number of new credit cards, political stance of current politicians 
C)  average worker salary, average number of children per family, current standard of living 
D)  labor-force participation rate, household debt as a share of disposable income, the real interest rate

Question 4

Prior to World War II,

Accepted Answer

A)  the growth of real GDP was more stable than has been the case since the war. 
B)  the growth of real GDP was less stable than has been the case since the war. 
C)  unemployment seldom exceeded 4 percent of the labor force. 
D)  double-digit swings in real GDP during a single year were unheard of. 
A)  the growth of real GDP was more stable than has been the case since the war. 
B)  the growth of real GDP was less stable than has been the case since the war. 
C)  unemployment seldom exceeded 4 percent of the labor force. 
D)  double-digit swings in real GDP during a single year were unheard of.

Question 5

As more and more of the baby-boom generation reach retirement age and draw on Social Security and Medicare,

Accepted Answer

A)  the Social Security Trust Fund will switch from running a deficit to a surplus. 
B)  unfunded promises included in the federal budget will decrease. 
C)  expenditures on these programs will increase the size of the federal debt. 
D)  the federal debt as a share of GDP will decrease. 
A)  the Social Security Trust Fund will switch from running a deficit to a surplus. 
B)  unfunded promises included in the federal budget will decrease. 
C)  expenditures on these programs will increase the size of the federal debt. 
D)  the federal debt as a share of GDP will decrease.

Question 6

Which of the following is part of the modern view of the Phillips curve?

Accepted Answer

A)  When inflation exceeds what was anticipated, unemployment falls below the natural rate. 
B)  When inflation is less than anticipated, unemployment will rise above the natural rate. 
C)  Demand stimulus policies can temporarily reduce unemployment, but in the long run, their primary impact will be on prices (inflation). 
D)  All of the above are correct. 
A)  When inflation exceeds what was anticipated, unemployment falls below the natural rate. 
B)  When inflation is less than anticipated, unemployment will rise above the natural rate. 
C)  Demand stimulus policies can temporarily reduce unemployment, but in the long run, their primary impact will be on prices (inflation). 
D)  All of the above are correct.

Question 7

The integration of expectations into macroeconomic analysis indicates that

Accepted Answer

A)  fiscal policy is more potent than monetary policy. 
B)  monetary policy is more potent than fiscal policy. 
C)  once people come to expect a given rate of inflation, the inflation will neither stimulate real output nor reduce unemployment. 
D)  higher rates of inflation will lead to lower rates of unemployment in the long run but not in the short run. 
A)  fiscal policy is more potent than monetary policy. 
B)  monetary policy is more potent than fiscal policy. 
C)  once people come to expect a given rate of inflation, the inflation will neither stimulate real output nor reduce unemployment. 
D)  higher rates of inflation will lead to lower rates of unemployment in the long run but not in the short run.

Question 8

Under the rational expectations hypothesis, which of the following is the most likely short-run effect of a move to expansionary monetary policy?

Accepted Answer

A)  a higher general level of prices but little or no change in real output 
B)  a higher general level of prices and an expansion in real output 
C)  no change in the general level of prices and a reduction in real output 
D)  no change in either the general level of prices or real output 
A)  a higher general level of prices but little or no change in real output 
B)  a higher general level of prices and an expansion in real output 
C)  no change in the general level of prices and a reduction in real output 
D)  no change in either the general level of prices or real output

Question 9

When there is an abrupt increase in the rate of inflation,

Accepted Answer

A)  the actual rate of inflation will tend to fall below the natural rate. 
B)  the actual rate of inflation will tend to rise above the natural rate. 
C)  the actual and natural rate of inflation will generally be equal. 
D)  the natural rate of unemployment will tend to rise. 
A)  the actual rate of inflation will tend to fall below the natural rate. 
B)  the actual rate of inflation will tend to rise above the natural rate. 
C)  the actual and natural rate of inflation will generally be equal. 
D)  the natural rate of unemployment will tend to rise.

Question 10

In 2016, the national debt of the United States was approximately

Accepted Answer

A)  5 percent of GDP. 
B)  25 percent of GDP. 
C)  77 percent of GDP. 
D)  105 percent of GDP. 
A)  5 percent of GDP. 
B)  25 percent of GDP. 
C)  77 percent of GDP. 
D)  105 percent of GDP.

If the federal government were to run a budget deficit, this would

What is the index of leading indicators, and what is it used for?

Which of the following variables are included in the index of leading indicators?

Prior to World War II,

As more and more of the baby-boom generation reach retirement age and draw on Social Security and Medicare,

Which of the following is part of the modern view of the Phillips curve?

The integration of expectations into macroeconomic analysis indicates that

Under the rational expectations hypothesis, which of the following is the most likely short-run effect of a move to expansionary monetary policy?

When there is an abrupt increase in the rate of inflation,

In 2016, the national debt of the United States was approximately

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Taking the Nations Economic Pulse

Economic Fluctuations, Unemployment, and Inflation

An Introduction to Basic Macroeconomic Markets

Dynamic Change, Economic Fluctuations, and the Ad--As Model

Fiscal Policy: The Keynesian View and the Historical Development of Macroeconomics

Fiscal Policy: Incentives, and Secondary Effects

Money and the Banking System

Modern Macroeconomics and Monetary Policy

Creating an Environment for Growth and Prosperity

Institutions, Policies, and Cross-Country Differences in Income and Growth

Gaining From International Trade

International Finance and the Foreign Exchange Market

Special Topics

Filters

Exam 15: Stabilization Policy, Output, and Employment

If the federal government were to run a budget deficit, this would

What is the index of leading indicators, and what is it used for?

Which of the following variables are included in the index of leading indicators?

Prior to World War II,

As more and more of the baby-boom generation reach retirement age and draw on Social Security and Medicare,

Which of the following is part of the modern view of the Phillips curve?

The integration of expectations into macroeconomic analysis indicates that

Under the rational expectations hypothesis, which of the following is the most likely short-run effect of a move to expansionary monetary policy?

When there is an abrupt increase in the rate of inflation,

In 2016, the national debt of the United States was approximately

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Taking the Nations Economic Pulse

Economic Fluctuations, Unemployment, and Inflation

An Introduction to Basic Macroeconomic Markets

Dynamic Change, Economic Fluctuations, and the Ad--As Model

Fiscal Policy: The Keynesian View and the Historical Development of Macroeconomics

Fiscal Policy: Incentives, and Secondary Effects

Money and the Banking System

Modern Macroeconomics and Monetary Policy

Creating an Environment for Growth and Prosperity

Institutions, Policies, and Cross-Country Differences in Income and Growth

Gaining From International Trade

International Finance and the Foreign Exchange Market

Special Topics

Filters