Question 1

Explain why the ups and downs of the business cycle are not 'smooth and regular', but are irregular in the real world.

Accepted Answer

The answer of Explain why the ups and downs of...

Question 2

Explain the costs of unemployment.

Accepted Answer

The answer of Explain the costs of unemployment....

Question 3

Outline the benefits and costs of economic growth.

Accepted Answer

The answer of Outline the benefits and costs of economic...

Question 4

The period in the business cycle from a trough to a peak is:

Accepted Answer

A)  a slowdown 
B)  an expansion or boom 
C)  a recession 
D)  a contraction or recession

Question 5

The upper turning point of the business cycle is the:

Accepted Answer

A)  expansion 
B)  slump 
C)  peaking out 
D)  slowdown

Question 6

Economic growth can only be achieved by demand- side policies and not policies that seek to increase aggregate supply.

Accepted Answer

A) True 
 B)False

Question 7

If the number of people classified as unemployed is 20 000 and the number of people classified as employed is 230 000, what is the unemployment rate?

Accepted Answer

A)  9.5% 
B)  9.0% 
C)  8.5% 
D)  8.0%

Question 8

Between 2000 and 2007 average annual growth rates in Australia were higher than in the United States, Japan and the United Kingdom.

Accepted Answer

A) True 
 B)False

Question 9

Transfer payments are made by the government to recipients without any productive activity taking place at the time the benefits are received.

Accepted Answer

A) True 
 B)False

Question 10

The unemployment rate is 10%, this means that the average worker has been employed for 10% of the year.

Accepted Answer

A) True 
 B)False

Question 11

A short- term rise in aggregate demand does not guarantee long- term economic growth.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following would normally NOT be considered as a macroeconomic issue?

Accepted Answer

A)  economic growth 
B)  the price of wheat 
C)  inflation 
D)  unemployment

Question 13

The diagram that shows how the four objectives of macroeconomic policy are related to aggregate demand is the:

Accepted Answer

A)  circular flow diagram 
B)  income- price diagram 
C)  aggregate demand- aggregate supply diagram 
D)  income- expenditure diagram

Question 14

The account in which changes in a country's foreign reserves are recorded is the:

Accepted Answer

A)  financial account 
B)  current account 
C)  capital account 
D)  merchandise trade account

Question 15

Differentiate between the current and the financial accounts in the balance of payments accounts.

Accepted Answer

The answer of Differentiate between the current and the financial...

Question 16

Real GDP values the output of an economy in current price levels.

Accepted Answer

A) True 
 B)False

Question 17

Inflation is:

Accepted Answer

A)  an increase in the overall level of economic activity 
B)  a decrease in the overall level of economic activity 
C)  an increase in the overall price level 
D)  a decrease in the overall price level

Question 18

The record of a country's transactions in goods, services, and assets with the rest of the world is its balance of trade.

Accepted Answer

A) True 
 B)False

Question 19

Children and pensioners who are not classified as being employed are classified as unemployed.

Accepted Answer

A) True 
 B)False

Question 20

Your boss gives you a pay rise of five percent and inflation is twelve percent. The change in your real wage is:

Accepted Answer

A)  5% 
B)  7% 
C)  12% 
D)  - 7%

Exam 9: Introduction to Macroeconomics

Explain why the ups and downs of the business cycle are not 'smooth and regular', but are irregular in the real world.

Explain the costs of unemployment.

Outline the benefits and costs of economic growth.

The period in the business cycle from a trough to a peak is:

The upper turning point of the business cycle is the:

Economic growth can only be achieved by demand- side policies and not policies that seek to increase aggregate supply.

If the number of people classified as unemployed is 20 000 and the number of people classified as employed is 230 000, what is the unemployment rate?

Between 2000 and 2007 average annual growth rates in Australia were higher than in the United States, Japan and the United Kingdom.

Transfer payments are made by the government to recipients without any productive activity taking place at the time the benefits are received.

The unemployment rate is 10%, this means that the average worker has been employed for 10% of the year.

A short- term rise in aggregate demand does not guarantee long- term economic growth.

Which of the following would normally NOT be considered as a macroeconomic issue?

The diagram that shows how the four objectives of macroeconomic policy are related to aggregate demand is the:

The account in which changes in a country's foreign reserves are recorded is the:

Differentiate between the current and the financial accounts in the balance of payments accounts.

Real GDP values the output of an economy in current price levels.

Inflation is:

The record of a country's transactions in goods, services, and assets with the rest of the world is its balance of trade.

Children and pensioners who are not classified as being employed are classified as unemployed.

Your boss gives you a pay rise of five percent and inflation is twelve percent. The change in your real wage is: