Question 1

Which of the following statements about the goals of the macroeconomy is true?

Accepted Answer

A)  All of the goals of the macroeconomy are attainable at the same time. 
B)  Price stability is never attainable in an economy like that of the United States. 
C)  Full employment, full production, and price stability are all attainable, but generally not at the same time. 
D)  Full production should not be a goal of the macroeconomy because there is no opportunity for economic growth if all resources are fully employed. 
A)  All of the goals of the macroeconomy are attainable at the same time. 
B)  Price stability is never attainable in an economy like that of the United States. 
C)  Full employment, full production, and price stability are all attainable, but generally not at the same time. 
D)  Full production should not be a goal of the macroeconomy because there is no opportunity for economic growth if all resources are fully employed.

Question 2

Which of the following statements about demand-pull inflation is FALSE?

Accepted Answer

A)  It occurs when the economy is close to, or at, full employment. 
B)  It can be described as "too many dollars chasing too few goods." 
C)  It occurs when there is too little spending and too much production. 
D)  There can be a tradeoff between unemployment and demand-pull inflation; as unemployment drops significantly, inflation can rise, and vice-versa. 
A)  It occurs when the economy is close to, or at, full employment. 
B)  It can be described as "too many dollars chasing too few goods." 
C)  It occurs when there is too little spending and too much production. 
D)  There can be a tradeoff between unemployment and demand-pull inflation; as unemployment drops significantly, inflation can rise, and vice-versa.

Question 3

Full employment:

Accepted Answer

A)  means that 100 percent of the labor force is working. 
B)  means that only the frictionally unemployed are out of work. 
C)  occurs when approximately 90 percent of the labor force is working. 
D)  occurs at a rate of unemployment which is universally agreed on and has not changed over the years. 
A)  means that 100 percent of the labor force is working. 
B)  means that only the frictionally unemployed are out of work. 
C)  occurs when approximately 90 percent of the labor force is working. 
D)  occurs at a rate of unemployment which is universally agreed on and has not changed over the years.

Question 4

GDP measures the value of all:

Accepted Answer

A)  goods and services sold in one year. 
B)  goods and services produced in one year. 
C)  finished goods and service sold in one year. 
D)  finished goods and services produced in one year. 
A)  goods and services sold in one year. 
B)  goods and services produced in one year. 
C)  finished goods and service sold in one year. 
D)  finished goods and services produced in one year.

Question 5

Since the 1990s the unemployment rate for:

Accepted Answer

A)  all women tended to be about the same as the unemployment rate for all men. 
B)  women who maintain families tended to be higher than the unemployment rate for teenagers. 
C)  all men with less than four years of high school tended to be higher than the unemployment rate for teenagers. 
D)  all of the above. 
A)  all women tended to be about the same as the unemployment rate for all men. 
B)  women who maintain families tended to be higher than the unemployment rate for teenagers. 
C)  all men with less than four years of high school tended to be higher than the unemployment rate for teenagers. 
D)  all of the above.

Question 6

Which of the following statements is FALSE?

Accepted Answer

A)  A change in the output of the economy causes a change in real GDP. 
B)  A change in the output of the economy causes a change in money GDP. 
C)  A change in the level of prices in the economy causes a change in real GDP. 
D)  A change in the level of prices in the economy causes a change in money GDP. 
A)  A change in the output of the economy causes a change in real GDP. 
B)  A change in the output of the economy causes a change in money GDP. 
C)  A change in the level of prices in the economy causes a change in real GDP. 
D)  A change in the level of prices in the economy causes a change in money GDP.

Question 7

-A good that cost $300 in year 2 would cost:

Accepted Answer

A)  $325 in year 4. 
B)  $375 in year 4. 
C)  $425 in year 4. 
D)  none of the above. 
A)  $325 in year 4. 
B)  $375 in year 4. 
C)  $425 in year 4. 
D)  none of the above.

Question 8

Unemployment is a matter of concern to individual workers for each of the following reasons EXCEPT:

Accepted Answer

A)  it often causes their taxes to go up. 
B)  it intensifies their personal struggle with scarcity. 
C)  if prolonged, it can affect spending habits and lifestyles. 
D)  it can affect self-esteem and have other psychological and physiological costs. 
A)  it often causes their taxes to go up. 
B)  it intensifies their personal struggle with scarcity. 
C)  if prolonged, it can affect spending habits and lifestyles. 
D)  it can affect self-esteem and have other psychological and physiological costs.

Question 9

-A good that cost $300 in year 2 would cost:

Accepted Answer

A)  $80 in year 1. 
B)  $180 in year 1. 
C)  $220 in year 1. 
D)  $240 in year 1. 
A)  $80 in year 1. 
B)  $180 in year 1. 
C)  $220 in year 1. 
D)  $240 in year 1.

Question 10

Which of the following statements is true?

Accepted Answer

A)  There is no country where gross domestic product has fallen over several years. 
B)  Real output per person has grown substantially in the United States since 1980. 
C)  The futility of the growth process for countries that have already achieved high levels of growth has been supported by the experience of the world's largest economies. 
D)  All of the above are true. 
A)  There is no country where gross domestic product has fallen over several years. 
B)  Real output per person has grown substantially in the United States since 1980. 
C)  The futility of the growth process for countries that have already achieved high levels of growth has been supported by the experience of the world's largest economies. 
D)  All of the above are true.

Question 11

The participation rate for women measures the percent of all women:

Accepted Answer

A)  who are full-time homemakers. 
B)  who are employed, regardless of age. 
C)  16 years of age and older who are employed. 
D)  16 years of age and older who are employed or actively seeking work. 
A)  who are full-time homemakers. 
B)  who are employed, regardless of age. 
C)  16 years of age and older who are employed. 
D)  16 years of age and older who are employed or actively seeking work.

Question 12

Why is real GDP a more accurate measure than money GDP for gauging the output of the economy?

Accepted Answer

Real GDP holds fixed

Question 13

A price index number of 105.0 for a particular year indicates that prices in that year are 5 percent higher than prices in the base year.

Accepted Answer

A) True 
 B)False

Question 14

When a person is out of work because the economy is in a recession and spending on the product he or she produces has fallen, the person is:

Accepted Answer

A)  cyclically unemployed. 
B)  frictionally unemployed. 
C)  voluntarily unemployed. 
D)  structurally unemployed. 
A)  cyclically unemployed. 
B)  frictionally unemployed. 
C)  voluntarily unemployed. 
D)  structurally unemployed.

Question 15

Which of the following statements is true?

Accepted Answer

A)  The full employment rate of unemployment has been at about 4 percent since the 1960s. 
B)  The economy is at full employment when only the cyclically unemployed are out of work. 
C)  The natural rate of unemployment is typically lower then the full employment rate of unemployment. 
D)  The natural rate of unemployment is the rate that includes only the frictionally and structurally unemployed. 
A)  The full employment rate of unemployment has been at about 4 percent since the 1960s. 
B)  The economy is at full employment when only the cyclically unemployed are out of work. 
C)  The natural rate of unemployment is typically lower then the full employment rate of unemployment. 
D)  The natural rate of unemployment is the rate that includes only the frictionally and structurally unemployed.

Question 16

The earnings a person receives from selling factors of production and the value of that person's tangible assets are:

Accepted Answer

A)  both called income. 
B)  both called wealth. 
C)  called income and wealth, respectively. 
D)  called wealth and income, respectively. 
A)  both called income. 
B)  both called wealth. 
C)  called income and wealth, respectively. 
D)  called wealth and income, respectively.

Question 17

Unemployment caused by an ongoing lack of consumer demand for a particular product, technological change that reduces the need for a specific type of labor, or the relocation of a production process is called:

Accepted Answer

A)  cyclical unemployment. 
B)  frictional unemployment. 
C)  structural unemployment. 
D)  systematic unemployment. 
A)  cyclical unemployment. 
B)  frictional unemployment. 
C)  structural unemployment. 
D)  systematic unemployment.

Question 18

Unemployment that is due to a decrease in the demand for workers with a certain skill because of technological change is:

Accepted Answer

A)  cyclical. 
B)  seasonal. 
C)  frictional. 
D)  structural. 
A)  cyclical. 
B)  seasonal. 
C)  frictional. 
D)  structural.

Question 19

Which of the following statements is true?

Accepted Answer

A)  Inflation improves the standard of living of persons earning fixed incomes. 
B)  Prolonged and severe inflation has no effect on a country's social and political institutions. 
C)  The real rate of interest is the nominal, or stated, rate of interest divided by the inflation rate. 
D)  Real income is the amount of goods and services that can be purchased with a particular amount of money income. 
A)  Inflation improves the standard of living of persons earning fixed incomes. 
B)  Prolonged and severe inflation has no effect on a country's social and political institutions. 
C)  The real rate of interest is the nominal, or stated, rate of interest divided by the inflation rate. 
D)  Real income is the amount of goods and services that can be purchased with a particular amount of money income.

Question 20

Money GDP measures the value of production:

Accepted Answer

A)  adjusted for inflation. 
B)  relative to potential output. 
C)  relative to the output of other nations. 
D)  in terms of prices at the time of production. 
A)  adjusted for inflation. 
B)  relative to potential output. 
C)  relative to the output of other nations. 
D)  in terms of prices at the time of production.

Which of the following statements about the goals of the macroeconomy is true?

Which of the following statements about demand-pull inflation is FALSE?

Full employment:

GDP measures the value of all:

Since the 1990s the unemployment rate for:

Which of the following statements is FALSE?

-A good that cost $300 in year 2 would cost:

Unemployment is a matter of concern to individual workers for each of the following reasons EXCEPT:

-A good that cost $300 in year 2 would cost:

Which of the following statements is true?

The participation rate for women measures the percent of all women:

Why is real GDP a more accurate measure than money GDP for gauging the output of the economy?

A price index number of 105.0 for a particular year indicates that prices in that year are 5 percent higher than prices in the base year.

When a person is out of work because the economy is in a recession and spending on the product he or she produces has fallen, the person is:

Which of the following statements is true?

The earnings a person receives from selling factors of production and the value of that person's tangible assets are:

Unemployment caused by an ongoing lack of consumer demand for a particular product, technological change that reduces the need for a specific type of labor, or the relocation of a production process is called:

Unemployment that is due to a decrease in the demand for workers with a certain skill because of technological change is:

Which of the following statements is true?

Money GDP measures the value of production:

Introduction to Economics

Economic Decision Making and Economic Systems

Demand, Supply, and the Determination of Price

Foundations of the Macroeconomy

The Role of Government in the Macroeconomy

Money, Financial Institutions, and the Federal Reserve

Money Creation, Monetary Theory, and Monetary Policy

Macroeconomic Viewpoints and Models

Households and Businesses: An Overview

Benefits, Costs, and Maximization

Production and the Costs of Production

Competition and Market Structures

Government and the Markets

Labor Markets, Unions, and the Distribution of Income-A

International Trade

International Finance

Filters

Exam 4: Goals and Problems of the Macroeconomy: Employment, Prices and Production

Which of the following statements about the goals of the macroeconomy is true?

Which of the following statements about demand-pull inflation is FALSE?

Full employment:

GDP measures the value of all:

Since the 1990s the unemployment rate for:

Which of the following statements is FALSE?

-A good that cost $300 in year 2 would cost:

Unemployment is a matter of concern to individual workers for each of the following reasons EXCEPT:

-A good that cost $300 in year 2 would cost:

Which of the following statements is true?

The participation rate for women measures the percent of all women:

Why is real GDP a more accurate measure than money GDP for gauging the output of the economy?

A price index number of 105.0 for a particular year indicates that prices in that year are 5 percent higher than prices in the base year.

When a person is out of work because the economy is in a recession and spending on the product he or she produces has fallen, the person is:

Which of the following statements is true?

The earnings a person receives from selling factors of production and the value of that person's tangible assets are:

Unemployment caused by an ongoing lack of consumer demand for a particular product, technological change that reduces the need for a specific type of labor, or the relocation of a production process is called:

Unemployment that is due to a decrease in the demand for workers with a certain skill because of technological change is:

Which of the following statements is true?

Money GDP measures the value of production:

Introduction to Economics

Economic Decision Making and Economic Systems

Demand, Supply, and the Determination of Price

Foundations of the Macroeconomy

The Role of Government in the Macroeconomy

Money, Financial Institutions, and the Federal Reserve

Money Creation, Monetary Theory, and Monetary Policy

Macroeconomic Viewpoints and Models

Households and Businesses: An Overview

Benefits, Costs, and Maximization

Production and the Costs of Production

Competition and Market Structures

Government and the Markets

Labor Markets, Unions, and the Distribution of Income-A

International Trade

International Finance

Filters