Question 1

Which of the following indicates that the U.S.economy has become more stable since 1950?

Accepted Answer

A)  longer recessions 
B)  shorter expansions 
C)  less severe fluctuations in real GDP 
D)  All of the above indicate that the U.S. economy has become more stable since 1950. 
A)  longer recessions 
B)  shorter expansions 
C)  less severe fluctuations in real GDP 
D)  All of the above indicate that the U.S. economy has become more stable since 1950.

Question 2

Economist Steve Landsburg has pointed out that Ebenezer Scrooge's change in behavior from miser to spender might actually be detrimental to the economy because

Accepted Answer

A)  Scrooge's miserly saving helped contribute to the production of investment goods rather than consumption goods. 
B)  Scrooge was happiest when he was saving money, and happiness is the key to economic growth. 
C)  saving has to be greater than consumption for the economy to grow. 
D)  Scrooge's consumption habits were more detrimental to the environment than were his earlier saving habits. 
A)  Scrooge's miserly saving helped contribute to the production of investment goods rather than consumption goods. 
B)  Scrooge was happiest when he was saving money, and happiness is the key to economic growth. 
C)  saving has to be greater than consumption for the economy to grow. 
D)  Scrooge's consumption habits were more detrimental to the environment than were his earlier saving habits.

Question 3

How does a decrease in the tax rate on income earned on saving affect saving,investment,the interest rate,and economic growth?

Accepted Answer

One determinant of the amount of househo

Question 4

Long-run economic growth requires all of the following except

Accepted Answer

A)  technological change. 
B)  increases in capital per hour worked. 
C)  government provision of secure property rights. 
D)  political instability. 
A)  technological change. 
B)  increases in capital per hour worked. 
C)  government provision of secure property rights. 
D)  political instability.

Question 5

When a recession ends

Accepted Answer

A)  interest rates decrease. 
B)  households decrease spending on durable goods. 
C)  the household sector decreases spending substantially. 
D)  firms increase the amount of borrowing. 
A)  interest rates decrease. 
B)  households decrease spending on durable goods. 
C)  the household sector decreases spending substantially. 
D)  firms increase the amount of borrowing.

Question 6

During a recession,spending on ________ tends to fall more dramatically than spending on ________.

Accepted Answer

A)  necessities; luxuries 
B)  durable goods; nondurable goods 
C)  nondurable goods; durable goods 
D)  food; cars 
A)  necessities; luxuries 
B)  durable goods; nondurable goods 
C)  nondurable goods; durable goods 
D)  food; cars

Question 7

From 1950 - 2007,recessions in the United States

Accepted Answer

A)  did not occur. 
B)  became more severe than before 1950. 
C)  became less severe than before 1950. 
D)  were about as severe as they were before 1950. 
A)  did not occur. 
B)  became more severe than before 1950. 
C)  became less severe than before 1950. 
D)  were about as severe as they were before 1950.

Question 8

A(n)________ comes to an end with a business cycle ________.

Accepted Answer

A)  recession; peak 
B)  recession; trough 
C)  expansion; trough 
D)  expansion; bubble 
A)  recession; peak 
B)  recession; trough 
C)  expansion; trough 
D)  expansion; bubble

Question 9

Scenario 14-1
Consider the following data for a closed economy:
Y = $12 trillion
C = $8 trillion
I = $2 trillion
G = $2 trillion
TR = $2 trillion
T = $3 trillion
-Refer to Scenario 14-1.Based on the information above,what is the level of public saving?

Accepted Answer

A)  $0 
B)  $1 trillion 
C)  $2 trillion 
D)  negative $1 trillion (a deficit of $1 trillion) 
A)  $0 
B)  $1 trillion 
C)  $2 trillion 
D)  negative $1 trillion (a deficit of $1 trillion)

Question 10

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 11

What is one difference between stocks and bonds?

Accepted Answer

A)  Bonds earn a higher rate of return than stocks. 
B)  Stocks earn a higher rate of return than bonds. 
C)  Bonds are purchased at a bank, while stocks are purchased through the federal government. 
D)  Stocks represent partial ownership in a firm, while bonds do not. 
A)  Bonds earn a higher rate of return than stocks. 
B)  Stocks earn a higher rate of return than bonds. 
C)  Bonds are purchased at a bank, while stocks are purchased through the federal government. 
D)  Stocks represent partial ownership in a firm, while bonds do not.

Question 12

Given the following economic data,what is the value of investment in a closed economy?
Y = $10 trillion
C = $5 trillion
TR = $2 trillion
G = $2 trillion

Accepted Answer

A)  $2 trillion 
B)  $3 trillion 
C)  $5 trillion 
D)  cannot be determined without information on taxes (T) 
A)  $2 trillion 
B)  $3 trillion 
C)  $5 trillion 
D)  cannot be determined without information on taxes (T)

Question 13

Table 14-2
 $\begin{array}{|c|c|}
\hline \text { Year } & \begin{array}{c}
\text { Real GDP (billions of } \
2000 \text { dollars) }
\end{array} \
\hline 2015 & \$ 10,100 \
\hline 2016 & 10,950 \
\hline 2017 & 11,425 \
\hline 2018 & 11,300 \
\hline
\end{array}$
-Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2016 to 2017?

Accepted Answer

A)  1% 
B)  2% 
C)  3% 
D)  4% 
A)  1% 
B)  2% 
C)  3% 
D)  4%

Question 14

Retained earnings are always sufficient to finance a firm's rapid expansion in a high-growth economy.

Accepted Answer

A) True 
 B)False

Question 15

An increase in the real interest rate will decrease consumption and investment.

Accepted Answer

A) True 
 B)False

Question 16

A firm can fund an expansion of its operations by

Accepted Answer

A)  issuing bonds. 
B)  buying stock. 
C)  paying dividends. 
D)  loaning money. 
A)  issuing bonds. 
B)  buying stock. 
C)  paying dividends. 
D)  loaning money.

Question 17

Labor productivity will increase if the ________ increases and ________.

Accepted Answer

A)  quantity of capital per hour worked; technology improves 
B)  quantity of labor per unit of capital; technology improves 
C)  quantity of capital per hour worked; immigration increases while capital is fixed 
D)  quantity of labor per unit of capital; immigration increases while capital is fixed 
A)  quantity of capital per hour worked; technology improves 
B)  quantity of labor per unit of capital; technology improves 
C)  quantity of capital per hour worked; immigration increases while capital is fixed 
D)  quantity of labor per unit of capital; immigration increases while capital is fixed

Question 18

For the recessions in the United States since the 1950s

Accepted Answer

A)  cyclical unemployment has been nonexistent. 
B)  unemployment rises on average by about 1.2 percentage points during the 12 months after a recession begins. 
C)  unemployment falls on average by 2 percentage points during the 12 months after a recession begins. 
D)  unemployment rises on average about 5 percentage points during the 12 months after a recession begins. 
A)  cyclical unemployment has been nonexistent. 
B)  unemployment rises on average by about 1.2 percentage points during the 12 months after a recession begins. 
C)  unemployment falls on average by 2 percentage points during the 12 months after a recession begins. 
D)  unemployment rises on average about 5 percentage points during the 12 months after a recession begins.

Question 19

Which of the following would increase public saving?

Accepted Answer

A)  an increase in taxes 
B)  an increase in transfers 
C)  an increase in government purchases 
D)  All of the above would increase public saving. 
A)  an increase in taxes 
B)  an increase in transfers 
C)  an increase in government purchases 
D)  All of the above would increase public saving.

Question 20

Because of technological change,oil companies like Chevron were able to produce almost twice as much output from refineries in 2016 as in 1950 while using 60 percent fewer workers.This represents ________ in output per worker,which is also known as ________.

Accepted Answer

A)  an increase; labor productivity 
B)  a decrease; structural unemployment 
C)  an increase; crowding out 
D)  a decrease; capital growth 
A)  an increase; labor productivity 
B)  a decrease; structural unemployment 
C)  an increase; crowding out 
D)  a decrease; capital growth

Which of the following indicates that the U.S.economy has become more stable since 1950?

Economist Steve Landsburg has pointed out that Ebenezer Scrooge's change in behavior from miser to spender might actually be detrimental to the economy because

How does a decrease in the tax rate on income earned on saving affect saving,investment,the interest rate,and economic growth?

Long-run economic growth requires all of the following except

When a recession ends

During a recession,spending on tends to fall more dramatically than spending on .

From 1950 - 2007,recessions in the United States

A(n) comes to an end with a business cycle .

Scenario 14-1 Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion I = $2 trillion G = $2 trillion TR = $2 trillion T = $3 trillion -Refer to Scenario 14-1.Based on the information above,what is the level of public saving?

One difference between stocks and bonds is that

What is one difference between stocks and bonds?

Given the following economic data,what is the value of investment in a closed economy? Y = $10 trillion C = $5 trillion TR = $2 trillion G = $2 trillion

Table 14-2 Year Real GDP (billions of 2000 dollars) 2015 \ 10,100 2016 10,950 2017 11,425 2018 11,300 -Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2016 to 2017?

Retained earnings are always sufficient to finance a firm's rapid expansion in a high-growth economy.

An increase in the real interest rate will decrease consumption and investment.

A firm can fund an expansion of its operations by

Labor productivity will increase if the increases and .

For the recessions in the United States since the 1950s

Which of the following would increase public saving?

Because of technological change,oil companies like Chevron were able to produce almost twice as much output from refineries in 2016 as in 1950 while using 60 percent fewer workers.This represents in output per worker,which is also known as .

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, The Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology,Production,and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, International Trade, and Exchange Rates

Filters

Exam 14: Economic Growth, The Financial System, and Business Cycles

Which of the following indicates that the U.S.economy has become more stable since 1950?

Economist Steve Landsburg has pointed out that Ebenezer Scrooge's change in behavior from miser to spender might actually be detrimental to the economy because

How does a decrease in the tax rate on income earned on saving affect saving,investment,the interest rate,and economic growth?

Long-run economic growth requires all of the following except

When a recession ends

During a recession,spending on ________ tends to fall more dramatically than spending on ________.

From 1950 - 2007,recessions in the United States

A(n)________ comes to an end with a business cycle ________.

Scenario 14-1 Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion I = $2 trillion G = $2 trillion TR = $2 trillion T = $3 trillion -Refer to Scenario 14-1.Based on the information above,what is the level of public saving?

One difference between stocks and bonds is that

What is one difference between stocks and bonds?

Given the following economic data,what is the value of investment in a closed economy? Y = $10 trillion C = $5 trillion TR = $2 trillion G = $2 trillion

Table 14-2 Year Real GDP (billions of 2000 dollars) 2015 \ 10,100 2016 10,950 2017 11,425 2018 11,300 -Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2016 to 2017?

Retained earnings are always sufficient to finance a firm's rapid expansion in a high-growth economy.

An increase in the real interest rate will decrease consumption and investment.

A firm can fund an expansion of its operations by

Labor productivity will increase if the ________ increases and ________.

For the recessions in the United States since the 1950s

Which of the following would increase public saving?

Because of technological change,oil companies like Chevron were able to produce almost twice as much output from refineries in 2016 as in 1950 while using 60 percent fewer workers.This represents ________ in output per worker,which is also known as ________.

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, The Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology,Production,and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, International Trade, and Exchange Rates

Filters

During a recession,spending on tends to fall more dramatically than spending on .

A(n) comes to an end with a business cycle .

Labor productivity will increase if the increases and .

Because of technological change,oil companies like Chevron were able to produce almost twice as much output from refineries in 2016 as in 1950 while using 60 percent fewer workers.This represents in output per worker,which is also known as .