Question 1

Figure 21-2
  
-Refer to Figure 21-2.Which of the following is consistent with the graph depicted above?

Accepted Answer

A)  An expected expansion increases the profitability of new investment. 
B)  The government runs a budget surplus. 
C)  There is a shift from an income tax to a consumption tax. 
D)  New government regulations decrease the profitability of new investment. 
A)  An expected expansion increases the profitability of new investment. 
B)  The government runs a budget surplus. 
C)  There is a shift from an income tax to a consumption tax. 
D)  New government regulations decrease the profitability of new investment.

Question 2

Figure 21-1
  
-Refer to Figure 21-1.Which of the following is consistent with the graph depicted above?

Accepted Answer

A)  An expected recession decreases the profitability of new investment. 
B)  Technological change increases the profitability of new investment. 
C)  The government runs a budget surplus. 
D)  Households become spendthrifts and begin to save less. 
A)  An expected recession decreases the profitability of new investment. 
B)  Technological change increases the profitability of new investment. 
C)  The government runs a budget surplus. 
D)  Households become spendthrifts and begin to save less.

Question 3

Most economists believe that the return of ________ during the 2007-2009 recession is a key reason why the recession was so severe.

Accepted Answer

A)  high tariffs 
B)  financial instability 
C)  rapid inflation 
D)  high interest rates 
A)  high tariffs 
B)  financial instability 
C)  rapid inflation 
D)  high interest rates

Question 4

In a closed economy,which of the following components of GDP is not included?

Accepted Answer

A)  investment 
B)  government spending 
C)  net exports 
D)  consumption 
A)  investment 
B)  government spending 
C)  net exports 
D)  consumption

Question 5

Figure 21-4
  
-Refer to Figure 21-4.Which of the following is consistent with the graph depicted?

Accepted Answer

A)  an increase in household income 
B)  an increase in transfer payments to households 
C)  an increase in the proportion of income after net taxes used for consumption 
D)  an increase in tax revenues collected by the government 
A)  an increase in household income 
B)  an increase in transfer payments to households 
C)  an increase in the proportion of income after net taxes used for consumption 
D)  an increase in tax revenues collected by the government

Question 6

Since the 1950s,

Accepted Answer

A)  the United States has not experienced a business cycle. 
B)  U.S. business cycle fluctuations have becomes more volatile. 
C)  U.S. business cycle fluctuations have become milder. 
D)  U.S. business cycle fluctuations have not changed. 
A)  the United States has not experienced a business cycle. 
B)  U.S. business cycle fluctuations have becomes more volatile. 
C)  U.S. business cycle fluctuations have become milder. 
D)  U.S. business cycle fluctuations have not changed.

Question 7

Since 1950,the average length of a recession in the United States has been

Accepted Answer

A)  such that recessions barely exist. 
B)  less than a year. 
C)  between 1 and 2 years. 
D)  greater than 2 years. 
A)  such that recessions barely exist. 
B)  less than a year. 
C)  between 1 and 2 years. 
D)  greater than 2 years.

Question 8

There is a government budget surplus if

Accepted Answer

A) T - TR > G. B) G > T. C) G > TR. D) TR < T. A) T - TR > G. B) G > T. C) G > TR. D) TR < T.

Question 9

Economist Robert Fogel has estimated that by the year 2040,individuals in the United States will be spending

Accepted Answer

A)  more time in the workforce and more time in leisure activities than they do today. 
B)  less time in the workforce and less time in leisure activities than they do today. 
C)  less time in the workforce and more time in leisure activities than they do today. 
D)  more time in the workforce and less time in leisure activities than they do today. 
A)  more time in the workforce and more time in leisure activities than they do today. 
B)  less time in the workforce and less time in leisure activities than they do today. 
C)  less time in the workforce and more time in leisure activities than they do today. 
D)  more time in the workforce and less time in leisure activities than they do today.

Question 10

The total amount of physical capital available in a country is know as the country's

Accepted Answer

A)  labor productivity. 
B)  savings. 
C)  investment. 
D)  capital stock. 
A)  labor productivity. 
B)  savings. 
C)  investment. 
D)  capital stock.

Question 11

As the economy nears the end of a recession,which of the following do we typically see?

Accepted Answer

A)  further decreases in consumer spending 
B)  increased spending on capital goods by firms 
C)  increasing interest rates 
D)  all of the above 
A)  further decreases in consumer spending 
B)  increased spending on capital goods by firms 
C)  increasing interest rates 
D)  all of the above

Question 12

How are unemployment,inflation,and the business cycle related?

Accepted Answer

A recessionary phase of a business cycle

Question 13

Consider the following data for a closed economy:
a.Y = $12 trillion
b.C = $8 trillion
c.I= $3 trillion
d.TR = $2 trillion
e.T = $3 trillion
Use the data provided to calculate the level of private saving and the level of public saving and demonstrate their relationship to investment.

Accepted Answer

Private saving is equal to Y + TR - C -

Question 14

The demand for durable goods

Accepted Answer

A)  has decreased over time. 
B)  declines by a greater percentage than does GDP during a recession. 
C)  declines by a smaller percentage than does GDP during a recession. 
D)  rises by a greater percentage than does GDP during a recession. 
A)  has decreased over time. 
B)  declines by a greater percentage than does GDP during a recession. 
C)  declines by a smaller percentage than does GDP during a recession. 
D)  rises by a greater percentage than does GDP during a recession.

Question 15

The response of investment spending to an increase in the government budget deficit is called

Accepted Answer

A)  expansionary investment. 
B)  private dissaving. 
C)  crowding out. 
D)  income minus net taxes. 
A)  expansionary investment. 
B)  private dissaving. 
C)  crowding out. 
D)  income minus net taxes.

Question 16

One difference between stocks and bonds is that

Accepted Answer

A)  stocks are financial securities, while bonds are labor market securities. 
B)  stocks are usually issued in electronic form, while bonds are usually issued in paper form. 
C)  stocks represent ownership in companies, while bonds represent ownership in banks. 
D)  stocks do not involve a promise to repay a purchaser of the stock, while bonds represent a promise to repay the purchase price of the bond. 
A)  stocks are financial securities, while bonds are labor market securities. 
B)  stocks are usually issued in electronic form, while bonds are usually issued in paper form. 
C)  stocks represent ownership in companies, while bonds represent ownership in banks. 
D)  stocks do not involve a promise to repay a purchaser of the stock, while bonds represent a promise to repay the purchase price of the bond.

Question 17

Which of the following explains the cause of the change in the unemployment rate at the end of a recession?

Accepted Answer

A)  Firms are hesitant to rehire laid off workers as they continue to operate below capacity. 
B)  Firms rapidly hire new workers at the first sign of on an increase in demand for their goods. 
C)  Discouraged workers return to the labor force and this makes the unemployment rate fall. 
D)  Discouraged workers leave the labor force and this makes the unemployment rate rise. 
A)  Firms are hesitant to rehire laid off workers as they continue to operate below capacity. 
B)  Firms rapidly hire new workers at the first sign of on an increase in demand for their goods. 
C)  Discouraged workers return to the labor force and this makes the unemployment rate fall. 
D)  Discouraged workers leave the labor force and this makes the unemployment rate rise.

Question 18

Borrowers are ________ of loanable funds,and lenders are ________ of loanable funds.

Accepted Answer

A)  demanders; suppliers 
B)  suppliers; demanders 
C)  suppliers; suppliers 
D)  demanders; demanders 
A)  demanders; suppliers 
B)  suppliers; demanders 
C)  suppliers; suppliers 
D)  demanders; demanders

Question 19

How have government policies and programs affected the volatility of the business cycle in the United States since 1950? Explain and provide at least two specific examples of policies or programs that may have had an impact.

Accepted Answer

Government programs like unemployment in

Question 20

Potential GDP is the maximum output a firm is capable of producing.

Accepted Answer

A) True 
 B)False

Figure 21-2 -Refer to Figure 21-2.Which of the following is consistent with the graph depicted above?

Figure 21-1 -Refer to Figure 21-1.Which of the following is consistent with the graph depicted above?

Most economists believe that the return of ________ during the 2007-2009 recession is a key reason why the recession was so severe.

In a closed economy,which of the following components of GDP is not included?

Figure 21-4 -Refer to Figure 21-4.Which of the following is consistent with the graph depicted?

Since the 1950s,

Since 1950,the average length of a recession in the United States has been

There is a government budget surplus if

Economist Robert Fogel has estimated that by the year 2040,individuals in the United States will be spending

The total amount of physical capital available in a country is know as the country's

As the economy nears the end of a recession,which of the following do we typically see?

How are unemployment,inflation,and the business cycle related?

Consider the following data for a closed economy: a.Y = $12 trillion b.C = $8 trillion c.I= $3 trillion d.TR = $2 trillion e.T = $3 trillion Use the data provided to calculate the level of private saving and the level of public saving and demonstrate their relationship to investment.

The demand for durable goods

The response of investment spending to an increase in the government budget deficit is called

One difference between stocks and bonds is that

Which of the following explains the cause of the change in the unemployment rate at the end of a recession?

Borrowers are of loanable funds,and lenders are of loanable funds.

How have government policies and programs affected the volatility of the business cycle in the United States since 1950? Explain and provide at least two specific examples of policies or programs that may have had an impact.

Potential GDP is the maximum output a firm is capable of producing.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Exam 10: Economic Growth, the Financial System, and Business Cycles

Figure 21-2 -Refer to Figure 21-2.Which of the following is consistent with the graph depicted above?

Figure 21-1 -Refer to Figure 21-1.Which of the following is consistent with the graph depicted above?

Most economists believe that the return of ________ during the 2007-2009 recession is a key reason why the recession was so severe.

In a closed economy,which of the following components of GDP is not included?

Figure 21-4 -Refer to Figure 21-4.Which of the following is consistent with the graph depicted?

Since the 1950s,

Since 1950,the average length of a recession in the United States has been

There is a government budget surplus if

Economist Robert Fogel has estimated that by the year 2040,individuals in the United States will be spending

The total amount of physical capital available in a country is know as the country's

As the economy nears the end of a recession,which of the following do we typically see?

How are unemployment,inflation,and the business cycle related?

Consider the following data for a closed economy: a.Y = $12 trillion b.C = $8 trillion c.I= $3 trillion d.TR = $2 trillion e.T = $3 trillion Use the data provided to calculate the level of private saving and the level of public saving and demonstrate their relationship to investment.

The demand for durable goods

The response of investment spending to an increase in the government budget deficit is called

One difference between stocks and bonds is that

Which of the following explains the cause of the change in the unemployment rate at the end of a recession?

Borrowers are ________ of loanable funds,and lenders are ________ of loanable funds.

How have government policies and programs affected the volatility of the business cycle in the United States since 1950? Explain and provide at least two specific examples of policies or programs that may have had an impact.

Potential GDP is the maximum output a firm is capable of producing.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Borrowers are of loanable funds,and lenders are of loanable funds.