Question 1

Macroeconomic models are

Accepted Answer

A)  never wrong. 
B)  accurate descriptions of the economy. 
C)  simple abstractions of reality. 
D)  consistent with all economic data. 
A)  never wrong. 
B)  accurate descriptions of the economy. 
C)  simple abstractions of reality. 
D)  consistent with all economic data. C

Question 2

Average labor productivity is defined as

Accepted Answer

A)  per-capital real GDP divided by employment. 
B)  nominal GDP divided by employment. 
C)  per-capita nominal GDP divided by employment. 
D)  real GDP divided by employment. 
A)  per-capital real GDP divided by employment. 
B)  nominal GDP divided by employment. 
C)  per-capita nominal GDP divided by employment. 
D)  real GDP divided by employment. D

Question 3

Over the twentieth century,growth in per-capita GNP was highest

Accepted Answer

A)  immediately prior to the Great Depression. 
B)  during World War II. 
C)  during the 1960s. 
D)  during the 1980s. 
A)  immediately prior to the Great Depression. 
B)  during World War II. 
C)  during the 1960s. 
D)  during the 1980s. B

Question 4

Unemployment is good from a social point of view because

Accepted Answer

A)  it keeps wages in check. 
B)  it allows for better matches between workers and firms. 
C)  it provides free time. 
D)  it keeps the least efficient workers out. 
A)  it keeps wages in check. 
B)  it allows for better matches between workers and firms. 
C)  it provides free time. 
D)  it keeps the least efficient workers out.

Question 5

A government surplus is

Accepted Answer

A)  when it spends more than its income. 
B)  when it owes more than what it is owed. 
C)  when its income is higher than its spending. 
D)  when it is owed more than what it owes. 
A)  when it spends more than its income. 
B)  when it owes more than what it is owed. 
C)  when its income is higher than its spending. 
D)  when it is owed more than what it owes.

Question 6

A useful macroeconomic model

Accepted Answer

A)  is extremely realistic. 
B)  is simple. 
C)  never generates testable hypotheses. 
D)  provides a lot of intricate details. 
A)  is extremely realistic. 
B)  is simple. 
C)  never generates testable hypotheses. 
D)  provides a lot of intricate details.

Question 7

The major contributor to the long-run improvement of a country's standard of living is

Accepted Answer

A)  low inflation. 
B)  growth in government. 
C)  population growth. 
D)  technological progress. 
A)  low inflation. 
B)  growth in government. 
C)  population growth. 
D)  technological progress.

Question 8

International trade between two countries

Accepted Answer

A)  benefits only the receiving country. 
B)  benefits only the sending country. 
C)  benefits both countries. 
D)  benefits neither country. 
A)  benefits only the receiving country. 
B)  benefits only the sending country. 
C)  benefits both countries. 
D)  benefits neither country.

Question 9

In the second half of the twentieth century,the U.S. inflation rate was at its highest in the period from

Accepted Answer

A)  1960 to the early 1970s. 
B)  the mid-1970s to the early 1980s. 
C)  the mid-1980s to the early 1990s. 
D)  1990-2000. 
A)  1960 to the early 1970s. 
B)  the mid-1970s to the early 1980s. 
C)  the mid-1980s to the early 1990s. 
D)  1990-2000.

Question 10

A productivity slowdown was observed from the

Accepted Answer

A)  early 1950s to the late 1960s. 
B)  early 1960s to the early 1970s. 
C)  late 1960s to the early 1980s. 
D)  mid-1980s to the late 1990s. 
A)  early 1950s to the late 1960s. 
B)  early 1960s to the early 1970s. 
C)  late 1960s to the early 1980s. 
D)  mid-1980s to the late 1990s.

Question 11

Which of the following assertions is false?

Accepted Answer

A)  The Great Depression was a typical business cycle. 
B)  Very rapid growth occurred during World War II. 
C)  Real GDP per capita dipped about 30% during the Great Depression. 
D)  On average, the U.S. economy grows at a rate of 2.1%. 
A)  The Great Depression was a typical business cycle. 
B)  Very rapid growth occurred during World War II. 
C)  Real GDP per capita dipped about 30% during the Great Depression. 
D)  On average, the U.S. economy grows at a rate of 2.1%.

Question 12

When we say the U.S. economy has grown on average at 2.1%,we mean

Accepted Answer

A)  the inflation rate. 
B)  the growth rate of nominal GDP. 
C)  the growth rate of per-capita nominal GDP. 
D)  the growth rate of per-capita real GDP. 
A)  the inflation rate. 
B)  the growth rate of nominal GDP. 
C)  the growth rate of per-capita nominal GDP. 
D)  the growth rate of per-capita real GDP.

Question 13

The real interest rate is

Accepted Answer

A)  always positive. 
B)  always negative. 
C)  variable. 
D)  zero. 
A)  always positive. 
B)  always negative. 
C)  variable. 
D)  zero.

Question 14

Inflation is defined as

Accepted Answer

A)  the rate of increase in the government budget deficit. 
B)  the increase in the money supply. 
C)  the rate of change in the average level of prices. 
D)  the nominal interest rate minus the price level. 
A)  the rate of increase in the government budget deficit. 
B)  the increase in the money supply. 
C)  the rate of change in the average level of prices. 
D)  the nominal interest rate minus the price level.

Question 15

Which of the following topics is NOT a primary concern of macroeconomists?

Accepted Answer

A)  fluctuations in the level of economic activity 
B)  differences in standards of living across countries 
C)  relative wages of skilled and unskilled workers 
D)  unemployment 
A)  fluctuations in the level of economic activity 
B)  differences in standards of living across countries 
C)  relative wages of skilled and unskilled workers 
D)  unemployment

Question 16

What is produced and consumed in the economy is determined jointly by

Accepted Answer

A)  government policies and the economy's productive capacity. 
B)  the economy's productive capacity and the preferences of consumers. 
C)  the preferences of consumers and the behavior of business managers. 
D)  the behavior of business managers and government policies. 
A)  government policies and the economy's productive capacity. 
B)  the economy's productive capacity and the preferences of consumers. 
C)  the preferences of consumers and the behavior of business managers. 
D)  the behavior of business managers and government policies.

Question 17

The Beveridge curve shifted outward during what period?

Accepted Answer

A)  during the Great Depression. 
B)  during the Great Moderation. 
C)  after January 2008. 
D)  between January 2000 and December 2007. 
A)  during the Great Depression. 
B)  during the Great Moderation. 
C)  after January 2008. 
D)  between January 2000 and December 2007.

Question 18

Which is a question of interest in this book?

Accepted Answer

A)  What causes illegal immigration? 
B)  What mechanism could force people to pollute less? 
C)  What causes economic fluctuations? 
D)  What is the effect of penalties on crime? 
A)  What causes illegal immigration? 
B)  What mechanism could force people to pollute less? 
C)  What causes economic fluctuations? 
D)  What is the effect of penalties on crime?

Question 19

An increase in energy prices is a likely cause of

Accepted Answer

A)  Great Depression. 
B)  Korean War inflation. 
C)  the recession in 1973-1975. 
D)  the Great Moderation. 
A)  Great Depression. 
B)  Korean War inflation. 
C)  the recession in 1973-1975. 
D)  the Great Moderation.

Question 20

Considering the future

Accepted Answer

A)  is irrelevant to macroeconomics. 
B)  is key to macroeconomic modelling. 
C)  has a limited impact on macroeconomic analysis. 
D)  matters only under special circumstances. 
A)  is irrelevant to macroeconomics. 
B)  is key to macroeconomic modelling. 
C)  has a limited impact on macroeconomic analysis. 
D)  matters only under special circumstances.

Macroeconomic models are

Average labor productivity is defined as

Over the twentieth century,growth in per-capita GNP was highest

Unemployment is good from a social point of view because

A government surplus is

A useful macroeconomic model

The major contributor to the long-run improvement of a country's standard of living is

International trade between two countries

In the second half of the twentieth century,the U.S. inflation rate was at its highest in the period from

A productivity slowdown was observed from the

Which of the following assertions is false?

When we say the U.S. economy has grown on average at 2.1%,we mean

The real interest rate is

Inflation is defined as

Which of the following topics is NOT a primary concern of macroeconomists?

What is produced and consumed in the economy is determined jointly by

The Beveridge curve shifted outward during what period?

Which is a question of interest in this book?

An increase in energy prices is a likely cause of

Considering the future

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Search and Unemployment

Economic Growth: Malthus and Solow

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption-Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking

Inflation, the Phillips Curve, and Central Bank Commitment

Filters

Exam 1: Introduction

Macroeconomic models are

Average labor productivity is defined as

Over the twentieth century,growth in per-capita GNP was highest

Unemployment is good from a social point of view because

A government surplus is

A useful macroeconomic model

The major contributor to the long-run improvement of a country's standard of living is

International trade between two countries

In the second half of the twentieth century,the U.S. inflation rate was at its highest in the period from

A productivity slowdown was observed from the

Which of the following assertions is false?

When we say the U.S. economy has grown on average at 2.1%,we mean

The real interest rate is

Inflation is defined as

Which of the following topics is NOT a primary concern of macroeconomists?

What is produced and consumed in the economy is determined jointly by

The Beveridge curve shifted outward during what period?

Which is a question of interest in this book?

An increase in energy prices is a likely cause of

Considering the future

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Search and Unemployment

Economic Growth: Malthus and Solow

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption-Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking

Inflation, the Phillips Curve, and Central Bank Commitment

Filters