Question 1

Business cycle persistence refers to the property that

Accepted Answer

A) booms and recessions last a long time. 
B) when real GDP is above trend, it tends to stay above trend, and when it is below trend, it tends to stay below trend. 
C) real GDP tends to stay in the peaks and troughs of the business cycle. 
D) real GDP is rarely exactly at trend. 
E) business cycles are persistently hard to predict. 
A) booms and recessions last a long time. 
B) when real GDP is above trend, it tends to stay above trend, and when it is below trend, it tends to stay below trend. 
C) real GDP tends to stay in the peaks and troughs of the business cycle. 
D) real GDP is rarely exactly at trend. 
E) business cycles are persistently hard to predict. B

Question 2

Forecasting real GDP is

Accepted Answer

A) done as well by the average person as by economic forecasters. 
B) easiest in terms of predicting turning points. 
C) easy in the short term, but hard in the long term. 
D) easy in the long term, but hard in the short term. 
E) always easy. 
A) done as well by the average person as by economic forecasters. 
B) easiest in terms of predicting turning points. 
C) easy in the short term, but hard in the long term. 
D) easy in the long term, but hard in the short term. 
E) always easy. D

Question 3

The Phillips curve shows the relationship between

Accepted Answer

A) lagging an leading variables. 
B) money prices and aggregate economic activity. 
C) real and nominal interest rates. 
D) procyclical and countercyclical variables. 
E) real and nominal GDP. 
A) lagging an leading variables. 
B) money prices and aggregate economic activity. 
C) real and nominal interest rates. 
D) procyclical and countercyclical variables. 
E) real and nominal GDP. B

Question 4

If the correlation coefficient between x and y is equal to -1, we say that x and y are

Accepted Answer

A) lagging variables. 
B) imperfectly negatively correlated. 
C) perfectly positively correlated. 
D) perfectly negatively correlated. 
E) countercyclical. 
A) lagging variables. 
B) imperfectly negatively correlated. 
C) perfectly positively correlated. 
D) perfectly negatively correlated. 
E) countercyclical.

Question 5

Average labour productivity is computed as the

Accepted Answer

A) ratio of real output in manufacturing to the level of real GDP. 
B) ratio of labour input to real GDP. 
C) ratio of real GDP to the unemployment rate. 
D) ratio of real GDP to the level of employment. 
E) ratio of industrial production to the employment rate. 
A) ratio of real output in manufacturing to the level of real GDP. 
B) ratio of labour input to real GDP. 
C) ratio of real GDP to the unemployment rate. 
D) ratio of real GDP to the level of employment. 
E) ratio of industrial production to the employment rate.

Question 6

The TSE composite index tends to

Accepted Answer

A) lag income growth. 
B) lead employment growth. 
C) lead real GDP. 
D) lead inflation. 
E) lag employment growth. 
A) lag income growth. 
B) lead employment growth. 
C) lead real GDP. 
D) lead inflation. 
E) lag employment growth.

Question 7

A reverse Phillips Curve would consist of a

Accepted Answer

A) positive relationship between deviations from trend in the level of prices and the level of aggregate economic activity. 
B) relationship between lagging and leading indicators. 
C) negative relationship between deviations from trend in real and nominal interest rates. 
D) negative relationship between deviations from trend in the level of prices and the level of aggregate economic activity. 
E) positive relationship between deviations from trend in real and nominal interest rates. 
A) positive relationship between deviations from trend in the level of prices and the level of aggregate economic activity. 
B) relationship between lagging and leading indicators. 
C) negative relationship between deviations from trend in real and nominal interest rates. 
D) negative relationship between deviations from trend in the level of prices and the level of aggregate economic activity. 
E) positive relationship between deviations from trend in real and nominal interest rates.

Question 8

The 2008-2009 recession was more severe than all recent recessions EXCEPT the one in

Accepted Answer

A) 2001-2002. 
B) 1969-1973. 
C) 1981-1982. 
D) 1990-1991. 
E) 1974-1975. 
A) 2001-2002. 
B) 1969-1973. 
C) 1981-1982. 
D) 1990-1991. 
E) 1974-1975.

Question 9

The property that macroeconomic variables fluctuate together in patterns that exhibit strong regularities is called

Accepted Answer

A) coexistence. 
B) correlation. 
C) coincidence. 
D) a leading indicator. 
E) comovement. 
A) coexistence. 
B) correlation. 
C) coincidence. 
D) a leading indicator. 
E) comovement.

Question 10

Negative correlation between x and y implies that

Accepted Answer

A) when x is high, y is low. 
B) when x is high, y is high. 
C) x/y < 0. 
D) xy < 0. 
E) the trend is unpredictable. 
A) when x is high, y is low. 
B) when x is high, y is high. 
C) x/y < 0. 
D) xy < 0. 
E) the trend is unpredictable.

Question 11

Why is forecasting GDP in the long run so difficult?

Accepted Answer

A) Structural and statistical forecasting provide differing results. 
B) There is no regularity in the frequency and amplitude of fluctuations in real GDP. 
C) Current models are not sophisticated enough to conduct this exercise. 
D) There is no expertise in forecasting the long-run trend in real GDP. 
E) These is an absence of data that provides any information on future trends. 
A) Structural and statistical forecasting provide differing results. 
B) There is no regularity in the frequency and amplitude of fluctuations in real GDP. 
C) Current models are not sophisticated enough to conduct this exercise. 
D) There is no expertise in forecasting the long-run trend in real GDP. 
E) These is an absence of data that provides any information on future trends.

Question 12

The value of macroeconomic knowledge is in

Accepted Answer

A) accurately forecasting stock prices. 
B) understanding macro phenomena and guiding policy. 
C) understanding firm level behaviour. 
D) accurately predicting recessions. 
E) producing forecasts. 
A) accurately forecasting stock prices. 
B) understanding macro phenomena and guiding policy. 
C) understanding firm level behaviour. 
D) accurately predicting recessions. 
E) producing forecasts.

Question 13

Comovement can be discussed by

Accepted Answer

A) looking at the peaks and troughs of the business cycle. 
B) economic forecasting models. 
C) looking at the frequency of the business cycle. 
D) looking at the amplitude of the business cycle. 
E) plotting the percentage deviations from trend in two economic variables. 
A) looking at the peaks and troughs of the business cycle. 
B) economic forecasting models. 
C) looking at the frequency of the business cycle. 
D) looking at the amplitude of the business cycle. 
E) plotting the percentage deviations from trend in two economic variables.

Question 14

If deviations from trend in a macroeconomic variable are positively correlated with deviations from trend in real GDP, that variable is said to be

Accepted Answer

A) useful in predicting future movements in real GDP. 
B) procyclical. 
C) countercyclical. 
D) uncorrelated. 
E) acyclical. 
A) useful in predicting future movements in real GDP. 
B) procyclical. 
C) countercyclical. 
D) uncorrelated. 
E) acyclical.

Question 15

Employment is

Accepted Answer

A) more variable than real GDP. 
B) about as variable as real investment. 
C) less variable than real GDP. 
D) acyclical. 
E) much more variable than consumption. 
A) more variable than real GDP. 
B) about as variable as real investment. 
C) less variable than real GDP. 
D) acyclical. 
E) much more variable than consumption.

Question 16

For the period 1961 2018 in Canada, the price level was

Accepted Answer

A) leading. 
B) procyclical. 
C) acyclical. 
D) countercyclical. 
E) bicyclical. 
A) leading. 
B) procyclical. 
C) acyclical. 
D) countercyclical. 
E) bicyclical.

Question 17

Why is it difficult to measure the cyclical properties of the real wage?

Accepted Answer

A) The composition of employed workers changes over the business cycle. 
B) Firms refuse to report data on workers' wages. 
C) Workers have money illusion. 
D) monetary and fiscal policy intervention 
E) Wages are sticky. 
A) The composition of employed workers changes over the business cycle. 
B) Firms refuse to report data on workers' wages. 
C) Workers have money illusion. 
D) monetary and fiscal policy intervention 
E) Wages are sticky.

Question 18

If deviations from trend in a macroeconomic variable are negatively correlated with deviations from trend in real GDP, that variable is said to be

Accepted Answer

A) acyclical. 
B) uncorrelated. 
C) countercyclical. 
D) useless in predicting future movements in real GDP. 
E) procyclical. 
A) acyclical. 
B) uncorrelated. 
C) countercyclical. 
D) useless in predicting future movements in real GDP. 
E) procyclical.

Question 19

Before 2000, the three most recent Canadian recessions occurred in

Accepted Answer

A) 1969-1973, 1979-1982, and 1994-1995. 
B) 1981-1982, 1990-1991, and 1998-1999. 
C) 1973-1975, 1982-1985, and 1990-1991. 
D) 1974-1975, 1981-1982, and 1990-1992. 
E) 1944-1945, 1955-1956, and 1990-1992. 
A) 1969-1973, 1979-1982, and 1994-1995. 
B) 1981-1982, 1990-1991, and 1998-1999. 
C) 1973-1975, 1982-1985, and 1990-1991. 
D) 1974-1975, 1981-1982, and 1990-1992. 
E) 1944-1945, 1955-1956, and 1990-1992.

Question 20

Investment tends to be a(n)

Accepted Answer

A) coincident variable. 
B) lagging variable. 
C) leading variable. 
D) procyclical variable. 
E) acyclical variable. 
A) coincident variable. 
B) lagging variable. 
C) leading variable. 
D) procyclical variable. 
E) acyclical variable.

Business cycle persistence refers to the property that

Forecasting real GDP is

The Phillips curve shows the relationship between

If the correlation coefficient between x and y is equal to -1, we say that x and y are

Average labour productivity is computed as the

The TSE composite index tends to

A reverse Phillips Curve would consist of a

The 2008-2009 recession was more severe than all recent recessions EXCEPT the one in

The property that macroeconomic variables fluctuate together in patterns that exhibit strong regularities is called

Negative correlation between x and y implies that

Why is forecasting GDP in the long run so difficult?

The value of macroeconomic knowledge is in

Comovement can be discussed by

If deviations from trend in a macroeconomic variable are positively correlated with deviations from trend in real GDP, that variable is said to be

Employment is

For the period 1961 2018 in Canada, the price level was

Why is it difficult to measure the cyclical properties of the real wage?

If deviations from trend in a macroeconomic variable are negatively correlated with deviations from trend in real GDP, that variable is said to be

Before 2000, the three most recent Canadian recessions occurred in

Investment tends to be a(n)

Introduction

Measurement

Consumer and Firm Behavior: the Workleisure 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 Consumptionsavings 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

Inflation: Phillips Curves and Neo-Fisherism

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking: a Deeper Look

Filters

Exam 3: Business Cycle Measurement

Business cycle persistence refers to the property that

Forecasting real GDP is

The Phillips curve shows the relationship between

If the correlation coefficient between x and y is equal to -1, we say that x and y are

Average labour productivity is computed as the

The TSE composite index tends to

A reverse Phillips Curve would consist of a

The 2008-2009 recession was more severe than all recent recessions EXCEPT the one in

The property that macroeconomic variables fluctuate together in patterns that exhibit strong regularities is called

Negative correlation between x and y implies that

Why is forecasting GDP in the long run so difficult?

The value of macroeconomic knowledge is in

Comovement can be discussed by

If deviations from trend in a macroeconomic variable are positively correlated with deviations from trend in real GDP, that variable is said to be

Employment is

For the period 1961 2018 in Canada, the price level was

Why is it difficult to measure the cyclical properties of the real wage?

If deviations from trend in a macroeconomic variable are negatively correlated with deviations from trend in real GDP, that variable is said to be

Before 2000, the three most recent Canadian recessions occurred in

Investment tends to be a(n)

Introduction

Measurement

Consumer and Firm Behavior: the Workleisure 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 Consumptionsavings 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

Inflation: Phillips Curves and Neo-Fisherism

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking: a Deeper Look

Filters