Question 1

Accumulating a greater number of inputs will ensure that an economy will experience economic growth.

Accepted Answer

A) True 
 B)False  False

Question 2

If consumers decide to be more frugal and save more out of their income,then this will cause

Accepted Answer

A)  a shift in the supply curve for loanable funds to the right. 
B)  a shift in the supply curve for loanable funds to the left. 
C)  a movement to the right along the supply curve for loanable funds. 
D)  a movement to the left along the supply curve for loanable funds. 
A)  a shift in the supply curve for loanable funds to the right. 
B)  a shift in the supply curve for loanable funds to the left. 
C)  a movement to the right along the supply curve for loanable funds. 
D)  a movement to the left along the supply curve for loanable funds. A

Question 3

Human capital refers to which of the following?

Accepted Answer

A)  the quantity of goods and services that can be produced by one worker or by one hour of work 
B)  the accumulated knowledge and skills workers acquire from education and training or from their life experiences 
C)  manufactured goods that are used to produce other goods and services 
D)  physical equipment that is made by human laborers, not machines 
A)  the quantity of goods and services that can be produced by one worker or by one hour of work 
B)  the accumulated knowledge and skills workers acquire from education and training or from their life experiences 
C)  manufactured goods that are used to produce other goods and services 
D)  physical equipment that is made by human laborers, not machines B

Question 4

If Ebenezer Scrooge spends rather than saves his vast wealth he will

Accepted Answer

A)  slow economic growth because he is reducing the amount of funds available for investment. 
B)  slow economic growth because he is increasing the amount of funds available for investment. 
C)  promote economic growth because he is increasing the amount of funds available for investment. 
D)  promote economic growth because he is decreasing the amount of funds available for investment. 
A)  slow economic growth because he is reducing the amount of funds available for investment. 
B)  slow economic growth because he is increasing the amount of funds available for investment. 
C)  promote economic growth because he is increasing the amount of funds available for investment. 
D)  promote economic growth because he is decreasing the amount of funds available for investment.

Question 5

What factors increase potential GDP? Include a definition of potential GDP in your answer.

Accepted Answer

Potential GDP is the level of GDP attain

Question 6

When the economy enters a recessionary phase of the business cycle,unemployment tends to

Accepted Answer

A)  decrease. 
B)  increase. 
C)  be unchanged. 
D)  change in the same direction as the rate of inflation. 
A)  decrease. 
B)  increase. 
C)  be unchanged. 
D)  change in the same direction as the rate of inflation.

Question 7

Increases in capital per hour worked cannot sustain high rates of economic growth unless accompanied by technological change.

Accepted Answer

A) True 
 B)False

Question 8

Figure 21-3
  
-Refer to Figure 21-3.Which of the following is consistent with the graph depicted above?

Accepted Answer

A)  Taxes are changed so that real interest income is taxed rather than nominal interest income. 
B)  An expected recession decreases the profitability of new investment. 
C)  The government runs a budget deficit. 
D)  Technological change increases the profitability of new investment. 
A)  Taxes are changed so that real interest income is taxed rather than nominal interest income. 
B)  An expected recession decreases the profitability of new investment. 
C)  The government runs a budget deficit. 
D)  Technological change increases the profitability of new investment.

Question 9

Use the equations for public and private saving to demonstrate how total saving in the economy equals investment.

Accepted Answer

Private saving is equal to Y + TR - C -

Question 10

The period of expansion ends with a ________ and the period of recession ends with a ________.

Accepted Answer

A)  business cycle peak; business cycle trough 
B)  business cycle trough; business cycle peak 
C)  business cycle peak; business cycle peak 
D)  business cycle trough; business cycle trough 
A)  business cycle peak; business cycle trough 
B)  business cycle trough; business cycle peak 
C)  business cycle peak; business cycle peak 
D)  business cycle trough; business cycle trough

Question 11

A government budget surplus from reduced government spending (no change in net taxes)will ________ the level of investment in the economy and ________ the level of saving (private plus public)in the economy.

Accepted Answer

A)  increase; decrease 
B)  increase; increase 
C)  decrease; increase 
D)  decrease; decrease 
A)  increase; decrease 
B)  increase; increase 
C)  decrease; increase 
D)  decrease; decrease

Question 12

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

Accepted Answer

When government spending increases,gover

Question 13

Purchases of Huggies diapers should

Accepted Answer

A)  remain fairly constant over the business cycle. 
B)  increase in recessions and decrease in expansions. 
C)  decrease in recessions and increase in expansions. 
D)  increase in recessions and remain constant in expansions. 
A)  remain fairly constant over the business cycle. 
B)  increase in recessions and decrease in expansions. 
C)  decrease in recessions and increase in expansions. 
D)  increase in recessions and remain constant in expansions.

Question 14

Increasing the amount of consumption spending and reducing the amount of savings ________ investment expenditures,and ________ long-run economic growth in the economy.

Accepted Answer

A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases

Question 15

What two factors are the keys to determining labor productivity?

Accepted Answer

A)  the business cycle and the growth rate of real GDP 
B)  the growth rate of real GDP and the interest rate 
C)  technology and the quantity of capital per hour worked 
D)  the average level of education of the workforce and the price level 
A)  the business cycle and the growth rate of real GDP 
B)  the growth rate of real GDP and the interest rate 
C)  technology and the quantity of capital per hour worked 
D)  the average level of education of the workforce and the price level

Question 16

In the United States,the average length of expansions from 1950 to 2009 was more than twice as long than they were from 1900 to 1950.

Accepted Answer

A) True 
 B)False

Question 17

If labor productivity growth slows down in a country,this will

Accepted Answer

A)  accelerate the increase in real GDP per capita. 
B)  accelerate the increase in nominal GDP. 
C)  slow down the increase in real GDP per capita. 
D)  slow down the increase in nominal GDP. 
A)  accelerate the increase in real GDP per capita. 
B)  accelerate the increase in nominal GDP. 
C)  slow down the increase in real GDP per capita. 
D)  slow down the increase in nominal GDP.

Question 18

Which of the following explains why fluctuations in real GDP have become less volatile in the United States since 1950?

Accepted Answer

A)  Services have become a smaller fraction of GDP since the 1950s. 
B)  Unemployment insurance and other government transfer programs are more prevalent since the 1950s. 
C)  The government has become more reluctant to intervene when real GDP declines and unemployment rises since the 1950s. 
D)  both B and C 
A)  Services have become a smaller fraction of GDP since the 1950s. 
B)  Unemployment insurance and other government transfer programs are more prevalent since the 1950s. 
C)  The government has become more reluctant to intervene when real GDP declines and unemployment rises since the 1950s. 
D)  both B and C

Question 19

If net taxes rise by $150 billion would you expect household saving to fall by $150 billion,by more than $150 billion,or by less than $150 billion?

Accepted Answer

Private saving is equal to Y - C - T,so

Question 20

Table 21-1
  
-Refer to Table 21-1.Using the table above,what is the approximate growth rate of real GDP from 2010 to 2011?

Accepted Answer

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

Accumulating a greater number of inputs will ensure that an economy will experience economic growth.

If consumers decide to be more frugal and save more out of their income,then this will cause

Human capital refers to which of the following?

If Ebenezer Scrooge spends rather than saves his vast wealth he will

What factors increase potential GDP? Include a definition of potential GDP in your answer.

When the economy enters a recessionary phase of the business cycle,unemployment tends to

Increases in capital per hour worked cannot sustain high rates of economic growth unless accompanied by technological change.

Figure 21-3 -Refer to Figure 21-3.Which of the following is consistent with the graph depicted above?

Use the equations for public and private saving to demonstrate how total saving in the economy equals investment.

The period of expansion ends with a and the period of recession ends with a .

A government budget surplus from reduced government spending (no change in net taxes)will the level of investment in the economy and the level of saving (private plus public)in the economy.

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

Purchases of Huggies diapers should

Increasing the amount of consumption spending and reducing the amount of savings investment expenditures,and long-run economic growth in the economy.

What two factors are the keys to determining labor productivity?

In the United States,the average length of expansions from 1950 to 2009 was more than twice as long than they were from 1900 to 1950.

If labor productivity growth slows down in a country,this will

Which of the following explains why fluctuations in real GDP have become less volatile in the United States since 1950?

If net taxes rise by $150 billion would you expect household saving to fall by $150 billion,by more than $150 billion,or by less than $150 billion?

Table 21-1 -Refer to Table 21-1.Using the table above,what is the approximate growth rate of real GDP from 2010 to 2011?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Exam 10: Economic Growth, the Financial System, and Business Cycles

Accumulating a greater number of inputs will ensure that an economy will experience economic growth.

If consumers decide to be more frugal and save more out of their income,then this will cause

Human capital refers to which of the following?

If Ebenezer Scrooge spends rather than saves his vast wealth he will

What factors increase potential GDP? Include a definition of potential GDP in your answer.

When the economy enters a recessionary phase of the business cycle,unemployment tends to

Increases in capital per hour worked cannot sustain high rates of economic growth unless accompanied by technological change.

Figure 21-3 -Refer to Figure 21-3.Which of the following is consistent with the graph depicted above?

Use the equations for public and private saving to demonstrate how total saving in the economy equals investment.

The period of expansion ends with a ________ and the period of recession ends with a ________.

A government budget surplus from reduced government spending (no change in net taxes)will ________ the level of investment in the economy and ________ the level of saving (private plus public)in the economy.

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

Purchases of Huggies diapers should

Increasing the amount of consumption spending and reducing the amount of savings ________ investment expenditures,and ________ long-run economic growth in the economy.

What two factors are the keys to determining labor productivity?

In the United States,the average length of expansions from 1950 to 2009 was more than twice as long than they were from 1900 to 1950.

If labor productivity growth slows down in a country,this will

Which of the following explains why fluctuations in real GDP have become less volatile in the United States since 1950?

If net taxes rise by $150 billion would you expect household saving to fall by $150 billion,by more than $150 billion,or by less than $150 billion?

Table 21-1 -Refer to Table 21-1.Using the table above,what is the approximate growth rate of real GDP from 2010 to 2011?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

The period of expansion ends with a and the period of recession ends with a .

A government budget surplus from reduced government spending (no change in net taxes)will the level of investment in the economy and the level of saving (private plus public)in the economy.

Increasing the amount of consumption spending and reducing the amount of savings investment expenditures,and long-run economic growth in the economy.