Question 1

Macroeconomists think that

Accepted Answer

A)  most questions about individual markets are more important than the overall economy. 
B)  questions of overall unemployment are less important than the jobs of particular workers. 
C)  the details of resource allocation and individual market prices are less important than the amount of national output. 
D)  the causes of unemployment usually lie with the personalities of individual workers. 
E)  the price of particular products is more important than the overall price level. 
A)  most questions about individual markets are more important than the overall economy. 
B)  questions of overall unemployment are less important than the jobs of particular workers. 
C)  the details of resource allocation and individual market prices are less important than the amount of national output. 
D)  the causes of unemployment usually lie with the personalities of individual workers. 
E)  the price of particular products is more important than the overall price level.

Question 2

Stabilization policy often faces a trade-off between inflation and unemployment.

Accepted Answer

A) True 
 B)False

Question 3

A product that is produced in 2010 and not sold until 2011 will be counted in the GDP for

Accepted Answer

A)  both 2010 and 2011. 
B)  neither 2010 nor 2011. 
C)  2010. 
D)  2011. 
A)  both 2010 and 2011. 
B)  neither 2010 nor 2011. 
C)  2010. 
D)  2011.

Question 4

In the period of U.S.economic history known as the Great Depression, the rate of inflation was generally

Accepted Answer

A)  trending upward. 
B)  positive. 
C)  uncertain. 
D)  negative. 
A)  trending upward. 
B)  positive. 
C)  uncertain. 
D)  negative.

Question 5

Economists define an aggregate as

Accepted Answer

A)  a concrete object. 
B)  a specific principle. 
C)  a representative good or service. 
D)  a useful abstraction. 
E)  something immeasurable. 
A)  a concrete object. 
B)  a specific principle. 
C)  a representative good or service. 
D)  a useful abstraction. 
E)  something immeasurable.

Question 6

An economist who studies the sales and profits of a large corporation would be classified as a(n)

Accepted Answer

A)  macroeconomist. 
B)  equity analyst. 
C)  stock broker. 
D)  microeconomist. 
E)  social economist. 
A)  macroeconomist. 
B)  equity analyst. 
C)  stock broker. 
D)  microeconomist. 
E)  social economist.

Question 7

The Great Depression of the 1930s

Accepted Answer

A)  confirmed the value of a "hands off" policy for governments. 
B)  was exacerbated by an expansionary monetary policy. 
C)  was a worldwide event. 
D)  continued throughout the 1940s without any interruption. 
A)  confirmed the value of a "hands off" policy for governments. 
B)  was exacerbated by an expansionary monetary policy. 
C)  was a worldwide event. 
D)  continued throughout the 1940s without any interruption.

Question 8

The existence of the "underground economy" causes measured GDP to overestimate actual output.

Accepted Answer

A) True 
 B)False

Question 9

In response to significant economic problems, the Obama administration recommended

Accepted Answer

A)  more tax cuts. 
B)  increased government spending. 
C)  substantial aid to state and local governments. 
D)  all of the above 
A)  more tax cuts. 
B)  increased government spending. 
C)  substantial aid to state and local governments. 
D)  all of the above

Question 10

Stagflation can be defined as a combination of ____.

Accepted Answer

A)  economic migration and inflation 
B)  economic aggregation and deflation 
C)  economic stagnation and inflation 
D)  economic aggregation and inflation 
A)  economic migration and inflation 
B)  economic aggregation and deflation 
C)  economic stagnation and inflation 
D)  economic aggregation and inflation

Question 11

The major difference between nominal GDP and real GDP is that

Accepted Answer

A)  real GDP is the absolute value of goods and services and nominal GDP is a relative value. 
B)  real GDP refers to products made in the United States and nominal GDP refers to both exports and imports. 
C)  nominal GDP is the market value and real GDP has been adjusted for inflation. 
D)  real GDP is a relative value and nominal GDP is an absolute value. 
A)  real GDP is the absolute value of goods and services and nominal GDP is a relative value. 
B)  real GDP refers to products made in the United States and nominal GDP refers to both exports and imports. 
C)  nominal GDP is the market value and real GDP has been adjusted for inflation. 
D)  real GDP is a relative value and nominal GDP is an absolute value.

Question 12

It might be useful to think of macroeconomics as a study of ____ and microeconomics as a study of ____.

Accepted Answer

A)  big corporations, small businesses 
B)  oceans, fish 
C)  the long run, the short run 
D)  abstract, concrete 
E)  theory, reality 
A)  big corporations, small businesses 
B)  oceans, fish 
C)  the long run, the short run 
D)  abstract, concrete 
E)  theory, reality

Question 13

Which of the following would tend to increase the value of officially measured GDP?

Accepted Answer

A)  decriminalization of drugs such as marijuana and cocaine 
B)  decriminalization of prostitution 
C)  decriminalization of gambling on basketball and football 
D)  all of the above 
A)  decriminalization of drugs such as marijuana and cocaine 
B)  decriminalization of prostitution 
C)  decriminalization of gambling on basketball and football 
D)  all of the above

Question 14

E&S Cooling Co.installs air conditioning systems in new houses for homebuilders, and replacement systems for homeowners.Sales of which systems are included in this year's GDP?

Accepted Answer

A)  Sales of replacement systems 
B)  Sales of both systems 
C)  Sales of systems in new houses 
D)  Neither system would be included, because they are always intermediate goods. 
A)  Sales of replacement systems 
B)  Sales of both systems 
C)  Sales of systems in new houses 
D)  Neither system would be included, because they are always intermediate goods.

Question 15

One of the initial problems facing the newly elected President Clinton was a large budget deficit.

Accepted Answer

A) True 
 B)False

Question 16

Combining various goods and services into a convenient grouping is called

Accepted Answer

A)  conglomeration. 
B)  blending. 
C)  congregation. 
D)  agglomeration. 
E)  aggregation. 
A)  conglomeration. 
B)  blending. 
C)  congregation. 
D)  agglomeration. 
E)  aggregation.

Question 17

Illegal gambling on the NCAA Final Four would be included in GDP.

Accepted Answer

A) True 
 B)False

Question 18

Gross Domestic Product is an economic aggregate that represents the

Accepted Answer

A)  potential output of a country. 
B)  total product of a nation's economy. 
C)  total income earned from all sales. 
D)  total product that a country exports. 
A)  potential output of a country. 
B)  total product of a nation's economy. 
C)  total income earned from all sales. 
D)  total product that a country exports.

Question 19

Changes in nominal GDP always reflect changes in real output.

Accepted Answer

A) True 
 B)False

Question 20

In her book on the American work week, economist Juliet Schorr argues that Americans work too much.Her argument may be interpreted as concluding that this behavior

Accepted Answer

A)  increases GDP but decreases well being. 
B)  increases GDP and increases well-being. 
C)  decreases GDP and decreases well being. 
D)  decreases GDP but increases well being. 
A)  increases GDP but decreases well being. 
B)  increases GDP and increases well-being. 
C)  decreases GDP and decreases well being. 
D)  decreases GDP but increases well being.

Exam 22: An Introduction to Macroeconomics

Macroeconomists think that

Stabilization policy often faces a trade-off between inflation and unemployment.

A product that is produced in 2010 and not sold until 2011 will be counted in the GDP for

In the period of U.S.economic history known as the Great Depression, the rate of inflation was generally

Economists define an aggregate as

An economist who studies the sales and profits of a large corporation would be classified as a(n)

The Great Depression of the 1930s

The existence of the "underground economy" causes measured GDP to overestimate actual output.

In response to significant economic problems, the Obama administration recommended

Stagflation can be defined as a combination of ____.

The major difference between nominal GDP and real GDP is that

It might be useful to think of macroeconomics as a study of ____ and microeconomics as a study of ____.

Which of the following would tend to increase the value of officially measured GDP?

E&S Cooling Co.installs air conditioning systems in new houses for homebuilders, and replacement systems for homeowners.Sales of which systems are included in this year's GDP?

One of the initial problems facing the newly elected President Clinton was a large budget deficit.

Combining various goods and services into a convenient grouping is called

Illegal gambling on the NCAA Final Four would be included in GDP.

Gross Domestic Product is an economic aggregate that represents the

Changes in nominal GDP always reflect changes in real output.

In her book on the American work week, economist Juliet Schorr argues that Americans work too much.Her argument may be interpreted as concluding that this behavior

What Is Economics?

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: An Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: The Importance of Marginal Analysis

Securities: Business Finance, and the Economy: The Tail that Wags the Dog?

The Firm and the Industry under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets I: The Price System

The Shortcomings of Free Markets

The Market's Prime Achievement: Innovation and Growth

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: The Human Inputs

Poverty, Inequality, and Discrimination

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation?

Bringing in the Supply Side: Unemployment and Inflation?

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder?

Exchange Rates and the Macroeconomy

Filters

It might be useful to think of macroeconomics as a study of and microeconomics as a study of .