Question 1

Historically,the U.S.government seems to have ________.

Accepted Answer

A) run budget surpluses as often as budget deficits 
B) generally spent less than what it collected in taxes each year 
C) had difficulty running budget surpluses 
D) not needed to borrow to finance wars 
E) none of the above 
A) run budget surpluses as often as budget deficits 
B) generally spent less than what it collected in taxes each year 
C) had difficulty running budget surpluses 
D) not needed to borrow to finance wars 
E) none of the above

Question 2

An advantage of discretionary policy might be that ________.

Accepted Answer

A) it has been shown to be more efficient than rules 
B) it is more flexible than rules 
C) it requires a binding plan in advance to deal with economic problems 
D) all of the above 
E) none of the above 
A) it has been shown to be more efficient than rules 
B) it is more flexible than rules 
C) it requires a binding plan in advance to deal with economic problems 
D) all of the above 
E) none of the above

Question 3

An increase in interest rates might be an example of a ________ policy for the purpose of ________.

Accepted Answer

A) monetary;reducing inflation 
B) monetary;lowering unemployment 
C) monetary;increasing the quantity of money 
D) fiscal;reducing inflation 
E) fiscal;lowering unemployment 
A) monetary;reducing inflation 
B) monetary;lowering unemployment 
C) monetary;increasing the quantity of money 
D) fiscal;reducing inflation 
E) fiscal;lowering unemployment

Question 4

There are no questions for this section.

Accepted Answer

As the input statement "There are no que

Question 5

Which of these is not among the principal determinants of economic growth?

Accepted Answer

A) institutions 
B) education 
C) research and development 
D) balanced trade 
E) saving and investment 
A) institutions 
B) education 
C) research and development 
D) balanced trade 
E) saving and investment

Question 6

Common sense suggests (and macroeconomists agree!)that sustained economic growth over extended time periods is more important than the economy's short-term fluctuations.Why,then,do macroeconomists (and policymakers,and the general public)care so much about the business cycle?

Accepted Answer

One reason is impatience.Periods of high

Question 7

A(n)________ variable is calculated from within the model.A(n)________ variable can never be taken as given.

Accepted Answer

A) endogenous;endogenous 
B) exogenous;endogenous 
C) endogenous;exogenous 
D) exogenous;exogenous 
E) none of the above 
A) endogenous;endogenous 
B) exogenous;endogenous 
C) endogenous;exogenous 
D) exogenous;exogenous 
E) none of the above

Question 8

Figure 1.1  
-Figure 1.1 displays exogenous variables entering a model from which emerge endogenous variables.Yet,in the five-step process to develop an economic model,the macroeconomist specifies the endogenous variables first,then the exogenous variables.Which is the correct sequence? Explain.

Accepted Answer

Both are correct.The figure displays a m

Question 9

From 1900 to 2013 real GDP per person in the U.S.has ________.

Accepted Answer

A) doubled 
B) grown by a factor of four 
C) grown by a factor of nine 
D) grown by a factor of twenty 
E) declined 
A) doubled 
B) grown by a factor of four 
C) grown by a factor of nine 
D) grown by a factor of twenty 
E) declined

Question 10

Nonactivists propose doing nothing in the face of economic hardship because ________.

Accepted Answer

A) activist policies can kick in at the wrong time and be counterproductive 
B) "markets self-correct pretty rapidly anyway" 
C) in the face of high unemployment,activist policies would likely lead to surges in inflation 
D) all of the above 
E) none of the above 
A) activist policies can kick in at the wrong time and be counterproductive 
B) "markets self-correct pretty rapidly anyway" 
C) in the face of high unemployment,activist policies would likely lead to surges in inflation 
D) all of the above 
E) none of the above

Question 11

Raising household savings could be beneficial because ________.

Accepted Answer

A) it translates into higher investment 
B) severe economic downturns can be "better-weathered" 
C) it provides a cushion to avoid bankruptcies 
D) all of the above 
E) none of the above 
A) it translates into higher investment 
B) severe economic downturns can be "better-weathered" 
C) it provides a cushion to avoid bankruptcies 
D) all of the above 
E) none of the above

Question 12

The Federal Reserve ________.

Accepted Answer

A) is the U.S.central bank 
B) controls the amount of money in the economy 
C) sets interest rates 
D) all of the above 
E) none of the above 
A) is the U.S.central bank 
B) controls the amount of money in the economy 
C) sets interest rates 
D) all of the above 
E) none of the above

Question 13

Which of the following sequences best describes the five necessary steps to develop an economic model in the correct order?

Accepted Answer

A) (1): Identify the endogenous variables;(2): identify the exogenous variables;(3): develop a model;(4): compare the model with the data;(5): conduct prediction and policy analysis. 
B) (1): Develop a model;(2): identify the exogenous variables;(3): identify the endogenous variables;(4): compare the model with the data;(5): conduct prediction and policy analysis. 
C) (1): Conduct prediction and policy analysis;(2): develop a model;(3): identify the endogenous variables;(4): identify the exogenous variables;(5): compare the model with the data. 
D) (1): Conduct prediction and policy analysis;(2): compare the model with the data;(3):identify the endogenous variables;(4): identify the exogenous variables;(5): develop a model. 
E) none of the above 
A) (1): Identify the endogenous variables;(2): identify the exogenous variables;(3): develop a model;(4): compare the model with the data;(5): conduct prediction and policy analysis. 
B) (1): Develop a model;(2): identify the exogenous variables;(3): identify the endogenous variables;(4): compare the model with the data;(5): conduct prediction and policy analysis. 
C) (1): Conduct prediction and policy analysis;(2): develop a model;(3): identify the endogenous variables;(4): identify the exogenous variables;(5): compare the model with the data. 
D) (1): Conduct prediction and policy analysis;(2): compare the model with the data;(3):identify the endogenous variables;(4): identify the exogenous variables;(5): develop a model. 
E) none of the above

Question 14

Macroeconomics is the study of ________ while microeconomics studies ________.

Accepted Answer

A) large business enterprises;small business ventures 
B) the overall household economic activity;market behavior 
C) an individual firm;the overall economic performance of a nation 
D) the overall economic performance of the world;the economy of a single country 
E) none of the above 
A) large business enterprises;small business ventures 
B) the overall household economic activity;market behavior 
C) an individual firm;the overall economic performance of a nation 
D) the overall economic performance of the world;the economy of a single country 
E) none of the above

Question 15

Macroeconomics is the study of ________ while microeconomics studies ________.

Accepted Answer

A) large biological systems;political implications of nanotechnology 
B) the overall economic activity and prices;an individual firm,household,or market 
C) an individual firm;the overall economic performance of a nation 
D) the overall economic performance of the world;the economy of a single country 
E) firm behavior;market behavior 
A) large biological systems;political implications of nanotechnology 
B) the overall economic activity and prices;an individual firm,household,or market 
C) an individual firm;the overall economic performance of a nation 
D) the overall economic performance of the world;the economy of a single country 
E) firm behavior;market behavior

Question 16

Which statement is true of an exogenous variable in an economic model?

Accepted Answer

A) It has no direct relation to the endogenous variables. 
B) Its value within the model cannot be changed. 
C) It is often a policy variable. 
D) It is explained inside the model. 
E) All of the above. 
A) It has no direct relation to the endogenous variables. 
B) Its value within the model cannot be changed. 
C) It is often a policy variable. 
D) It is explained inside the model. 
E) All of the above.

Question 17

The necessary ingredients for economic growth and poverty reduction are no mystery,really: education,favorable and efficient institutions,research and development,etc.Macroeconomists are unlikely to have anything useful to say.Comment.

Accepted Answer

The ingredients are familiar,but impleme

Question 18

Which of these is among the principal determinants of economic growth?

Accepted Answer

A) inflation 
B) the financial system 
C) the central bank 
D) the government budget deficit 
E) stabilization policy 
A) inflation 
B) the financial system 
C) the central bank 
D) the government budget deficit 
E) stabilization policy

Question 19

Assume that a high proportion of recent college graduates decides to stay in school seeking advanced degrees,rather than confront the challenge of landing a good job in the midst of generally high unemployment.What is the direct impact of this behavior on the unemployment rate? In the longer term,what indirect impacts might there be on the unemployment rate?

Accepted Answer

Staying in school means that these gradu

Question 20

Macroeconomic models particularly focus on the following three economic data series.

Accepted Answer

A) real GDP,the unemployment rate,and inflation 
B) endogenous variables,exogenous variables,and GDP per person 
C) inflation,recessions,and business cycles 
D) real GDP,the employment rate,and interest rates 
E) real GDP,the unemployment rate,and depressions 
A) real GDP,the unemployment rate,and inflation 
B) endogenous variables,exogenous variables,and GDP per person 
C) inflation,recessions,and business cycles 
D) real GDP,the employment rate,and interest rates 
E) real GDP,the unemployment rate,and depressions

Exam 1: The Policy and Practice of Macroeconomics

Historically,the U.S.government seems to have ________.

An advantage of discretionary policy might be that ________.

An increase in interest rates might be an example of a ________ policy for the purpose of ________.

There are no questions for this section.

Which of these is not among the principal determinants of economic growth?

Common sense suggests (and macroeconomists agree!)that sustained economic growth over extended time periods is more important than the economy's short-term fluctuations.Why,then,do macroeconomists (and policymakers,and the general public)care so much about the business cycle?

A(n)________ variable is calculated from within the model.A(n)________ variable can never be taken as given.

Figure 1.1 -Figure 1.1 displays exogenous variables entering a model from which emerge endogenous variables.Yet,in the five-step process to develop an economic model,the macroeconomist specifies the endogenous variables first,then the exogenous variables.Which is the correct sequence? Explain.

From 1900 to 2013 real GDP per person in the U.S.has ________.

Nonactivists propose doing nothing in the face of economic hardship because ________.

Raising household savings could be beneficial because ________.

The Federal Reserve ________.

Which of the following sequences best describes the five necessary steps to develop an economic model in the correct order?

Macroeconomics is the study of ________ while microeconomics studies ________.

Macroeconomics is the study of ________ while microeconomics studies ________.

Which statement is true of an exogenous variable in an economic model?

The necessary ingredients for economic growth and poverty reduction are no mystery,really: education,favorable and efficient institutions,research and development,etc.Macroeconomists are unlikely to have anything useful to say.Comment.

Which of these is among the principal determinants of economic growth?

Macroeconomic models particularly focus on the following three economic data series.

Measuring Macroeconomic Data

Aggregate Production and Productivity

Saving and Investment in Closed and Open Economies

Money and Inflation

The Sources of Growth and the Solow Model

Drivers of Growth: Technology, policy, and Institutions

Business Cycles: an Introduction

The Is Curve

Monetary Policy and Aggregate Demand

Aggregate Supply and the Phillips Curve

The Aggregate Demand and Supply Model

Macroeconomic Policy and Aggregate Demand and Supply Analysis

The Financial System and Economic Growth

Financial Crises and the Economy

Fiscal Policy and the Government Budget

Exchange Rates and International Economic Policy

Consumption and Saving

Investment

The Labor Market, employment, and Unemployment

The Role of Expectations in Macroeconomic Policy

Modern Business Cycle Theory

Filters

An increase in interest rates might be an example of a policy for the purpose of .

A(n) variable is calculated from within the model.A(n) variable can never be taken as given.

Macroeconomics is the study of while microeconomics studies .

Macroeconomics is the study of while microeconomics studies .