Question 1

A period in which the price level is rising is experiencing

Accepted Answer

A)  inflation. 
B)  reflation. 
C)  deflation. 
D)  deconstruction.

Question 2

While their respective subject matters differ greatly, both microeconomists and macroeconomists rely on the same basic tools; that is, both rely on

Accepted Answer

A)  government contracts to promote research and publications. 
B)  demand and supply analysis. 
C)  the economic theory of John Maynard Keynes. 
D)  consumer protection laws and antitrust legislation.

Question 3

Microeconomics focuses on ____; macroeconomics concentrates on ____.

Accepted Answer

A)  the basic tools of analysis; the use of abstractions and models 
B)  the economies of various countries; the decisions of individual companies 
C)  the decisions of individual units; the behavior of entire economies 
D)  the economic aggregates; the decisions of individual units

Question 4

The significantly high rates of inflation in the 1970s occurred, in part,

Accepted Answer

A)  because of increased petroleum prices. 
B)  due to high unemployment. 
C)  despite falling gasoline prices. 
D)  due to restrictive monetary policies.

Question 5

Part of the good economic performance of the United States in the 1990s can be explained by a rightward-shifting aggregate supply curve.

Accepted Answer

A) True 
 B)False

Question 6

Compare and contrast the U.S. economic record prior to 1940 and after 1950. How do the two time periods differ? What best explains the differences according to a macroeconomist?

Accepted Answer

The answer of Compare and contrast the U.S. economic record...

Question 7

Changes in nominal GDP always reflect changes in real output.

Accepted Answer

A) True 
 B)False

Question 8

For a macroeconomist, the case for aggregation is based on two principles-(1) the composition of demand and supply may not matter for some purposes and (2)

Accepted Answer

A)  during fluctuations markets normally move together. 
B)  individual markets allocate resources efficiently. 
C)  inflation, unemployment, and growth never go together. 
D)  individual markets distribute income efficiently.

Question 9

What are intermediate goods? Why do economists exclude the value of intermediate goods while calculating national income?

Accepted Answer

The answer of What are intermediate goods? Why do economists...

Question 10

A product that is produced in 2015 and not sold until 2016 will be counted in the GDP for

Accepted Answer

A)  both 2015 and 2016. 
B)  neither 2015 nor 2016. 
C)  2015 
D)  2016

Question 11

The human consequences of the Great Depression did not include

Accepted Answer

A)  homeless families. 
B)  closed factories. 
C)  bankrupt farmers. 
D)  soup lines. 
E)  redistribution from the rich to the poor.

Question 12

Economic aggregates are studied by microeconomists.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following items are included in GDP? For those items not included, explain why they are not included in GDP. 
a. Jane buys newly issued shares of stock in Macro.com, Inc. 
b. Ross buys a new pair of jeans at a local department store. 
c. Joey has his mustache trimmed at his hair salon. 
d. Rachel buys an antique chest at a resale shop. 
e. Monica makes her own pasta sauce in her apartment. 
f. Phoebe grows her own herbs on her apartment balcony. 
g. Michael travels to Austria and buys wine and cheese.

Accepted Answer

The answer of Which of the following items are included...

Question 14

Figure 5-2

In Figure 5-2, if the aggregate demand curve moves to the right less rapidly than the aggregate supply curve, then

Accepted Answer

A)  the price level should decline over time. 
B)  the price level should remain stable. 
C)  the price level will tend to increase. 
D)  the level of real GDP should decrease.

Question 15

If the price of pizza is $10 this year and $15 next year, then 200 pizzas would contribute

Accepted Answer

A)  $2,000 to this year's GDP and $2,000 to next year's nominal GDP. 
B)  $3,000 to this year's nominal GDP and $3,000 to next year's nominal GDP. 
C)  $2,000 to this year's nominal GDP and $3,000 to next year's nominal GDP. 
D)  $3,000 to this year's GDP and $2,000 to next year's GDP.

Question 16

Both the Bush and Obama administrations used tax cuts as a remedy to the housing "bubble."

Accepted Answer

A) True 
 B)False

Question 17

The composition of demand and supply is relatively unimportant to the study of inflation and unemployment rates.

Accepted Answer

A) True 
 B)False

Question 18

The macroeconomic conditions during the mid-1990s confounded many economists because of the simultaneous occurrence of

Accepted Answer

A)  low unemployment and decreasing inflation rates. 
B)  low unemployment and increasing budget deficits. 
C)  low unemployment and increasing interest rates. 
D)  high unemployment and increasing inflation rates.

Question 19

The successes of the 1960s were ascribed to the effects of

Accepted Answer

A)  classical policies from the 1800s. 
B)  classical policies from the 1930s. 
C)  classical policies from the 1950s. 
D)  Keynesian policies from the 1930s. 
E)  Keynesian policies from the 1950s.

Question 20

Macroeconomic models use abstract concepts such as "price level" and "national income" that are calculated by combining many markets into one. This process is known as

Accepted Answer

A)  analysis and synthesis. 
B)  integration and derivation. 
C)  conceptualization. 
D)  aggregation.

Exam 21: An Introduction to Macroeconomics

A period in which the price level is rising is experiencing

While their respective subject matters differ greatly, both microeconomists and macroeconomists rely on the same basic tools; that is, both rely on

Microeconomics focuses on ; macroeconomics concentrates on .

The significantly high rates of inflation in the 1970s occurred, in part,

Part of the good economic performance of the United States in the 1990s can be explained by a rightward-shifting aggregate supply curve.

Compare and contrast the U.S. economic record prior to 1940 and after 1950. How do the two time periods differ? What best explains the differences according to a macroeconomist?

Changes in nominal GDP always reflect changes in real output.

For a macroeconomist, the case for aggregation is based on two principles-(1) the composition of demand and supply may not matter for some purposes and (2)

What are intermediate goods? Why do economists exclude the value of intermediate goods while calculating national income?

A product that is produced in 2015 and not sold until 2016 will be counted in the GDP for

The human consequences of the Great Depression did not include

Economic aggregates are studied by microeconomists.

Figure 5-2 In Figure 5-2, if the aggregate demand curve moves to the right less rapidly than the aggregate supply curve, then

If the price of pizza is $10 this year and $15 next year, then 200 pizzas would contribute

Both the Bush and Obama administrations used tax cuts as a remedy to the housing "bubble."

The composition of demand and supply is relatively unimportant to the study of inflation and unemployment rates.

The macroeconomic conditions during the mid-1990s confounded many economists because of the simultaneous occurrence of

The successes of the 1960s were ascribed to the effects of

Macroeconomic models use abstract concepts such as "price level" and "national income" that are calculated by combining many markets into one. This process is known as