Question 1

During the recession phase of the business cycle

Accepted Answer

A) production is usually rising. 
B) interest rates are usually falling. 
C) unemployment is usually falling. 
D) income is usually rising. 
E) labour force participation is usually rising. 
A) production is usually rising. 
B) interest rates are usually falling. 
C) unemployment is usually falling. 
D) income is usually rising. 
E) labour force participation is usually rising.

Question 2

According to the commonly used definition, Canada has experienced ________ recession(s)since 1980.

Accepted Answer

A) 1 
B) 2 
C) 3 
D) 4 
E) 5 
A) 1 
B) 2 
C) 3 
D) 4 
E) 5

Question 3

If real GDP grows by 3% in 2013, 3.2% in 2014, and 2.5% in 2015, what is the average annual growth rate of real GDP?

Accepted Answer

A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2% 
E) 5.3% 
A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2% 
E) 5.3%

Question 4

If the CPI is currently 202, what does this tell you about inflation between last year and this year?

Accepted Answer

A) There was deflation in the economy between this year and last year. 
B) Inflation in the economy between this year and last year was 2%. 
C) Inflation in the economy between this year and last year was 102%. 
D) The CPI measures only the level of prices in a given year, not the percentage change in prices from one year to the next. 
E) This economy is suffering from deflation. 
A) There was deflation in the economy between this year and last year. 
B) Inflation in the economy between this year and last year was 2%. 
C) Inflation in the economy between this year and last year was 102%. 
D) The CPI measures only the level of prices in a given year, not the percentage change in prices from one year to the next. 
E) This economy is suffering from deflation.

Question 5

In a closed economy, what is the relationship between saving and investment?

Accepted Answer

A) Saving is greater than investment. 
B) Investment is greater than saving. 
C) Investment is equal to saving. 
D) Investment may be greater or smaller than saving. 
E) Saving is greater than investment, but they both grow at the same rate. 
A) Saving is greater than investment. 
B) Investment is greater than saving. 
C) Investment is equal to saving. 
D) Investment may be greater or smaller than saving. 
E) Saving is greater than investment, but they both grow at the same rate.

Question 6

Market economies tend to grow more quickly than centrally-planned economies.

Accepted Answer

A) True 
 B)False

Question 7

How will an increase in the government budget surplus as a result of lower government spending (with no change in net taxes)affect private saving in the economy?

Accepted Answer

A) Private saving will increase by the amount of increase in the budget surplus. 
B) Private saving will decrease by the amount of increase in the budget surplus. 
C) Private saving will decrease by less than the amount of increase in the budget surplus. 
D) Private saving will be unaffected by the increase in the budget surplus. 
E) Private saving will increase by less than the amount of decrease in public savings. 
A) Private saving will increase by the amount of increase in the budget surplus. 
B) Private saving will decrease by the amount of increase in the budget surplus. 
C) Private saving will decrease by less than the amount of increase in the budget surplus. 
D) Private saving will be unaffected by the increase in the budget surplus. 
E) Private saving will increase by less than the amount of decrease in public savings.

Question 8

Technological advances generally result in

Accepted Answer

A) decreased incomes. 
B) increased life expectancy. 
C) increased infant mortality rates. 
D) increased average number of hours worked per day. 
E) rising unemployment. 
A) decreased incomes. 
B) increased life expectancy. 
C) increased infant mortality rates. 
D) increased average number of hours worked per day. 
E) rising unemployment.

Question 9

The generally accepted definition of a recession is

Accepted Answer

A) two consecutive quarters of declining real GDP. 
B) two consecutive quarters of declining nominal GDP. 
C) a significant decline in activity visible in industrial production, employment, real income, and wholesale/retail trade lasting more than a few months. 
D) a significant decline in inflation and unemployment lasting more than a few months. 
E) 9 months of rising unemployment and falling inflation. 
A) two consecutive quarters of declining real GDP. 
B) two consecutive quarters of declining nominal GDP. 
C) a significant decline in activity visible in industrial production, employment, real income, and wholesale/retail trade lasting more than a few months. 
D) a significant decline in inflation and unemployment lasting more than a few months. 
E) 9 months of rising unemployment and falling inflation.

Question 10

What is the name of the organization that officially defines business cycle peaks and troughs in Canada?

Accepted Answer

A) the Bureau of Labour Statistics 
B) the Bank of Canada 
C) Statistics Canada 
D) the federal Department of Finance 
E) There is no such organization in Canada. 
A) the Bureau of Labour Statistics 
B) the Bank of Canada 
C) Statistics Canada 
D) the federal Department of Finance 
E) There is no such organization in Canada.

Question 11

The supply of loanable funds has a ________ slope because the greater the interest rate, the ________ the reward to saving, and the ________ the quantity of loanable funds supplied.

Accepted Answer

A) positive; lower; lower 
B) positive; greater; lower 
C) negative; lower; greater 
D) positive; greater; greater 
A) positive; lower; lower 
B) positive; greater; lower 
C) negative; lower; greater 
D) positive; greater; greater

Question 12

The quantity of goods and services that can be produced by one worker or by one hour of work is referred to as

Accepted Answer

A) technology. 
B) labour productivity. 
C) real GDP. 
D) human capital. 
E) unit efficiency. 
A) technology. 
B) labour productivity. 
C) real GDP. 
D) human capital. 
E) unit efficiency.

Question 13

________ are financial securities that represent partial ownership of a firm.

Accepted Answer

A) Stocks 
B) Bonds 
C) Treasury bills 
D) Certificates of deposit 
E) Savings deposits 
A) Stocks 
B) Bonds 
C) Treasury bills 
D) Certificates of deposit 
E) Savings deposits

Question 14

Suppose you are a famous international economic advisor.You have been asked to asses the possibilities for growth in an African country.It is a country abundant in labour and some natural resources.The capital to labour ratio is low.It has a free market economy.You have found that this country does not have a very strong banking system, however the political system is stable and the government does a good job of protecting property rights.Assess this country's prospects for growth.Recommend two things that would enhance the country's growth.

Accepted Answer

The prospects for this country's growth

Question 15

Potential GDP in Canada

Accepted Answer

A) does not change over time. 
B) grows as the economy grows. 
C) changes over a given business cycle. 
D) declines over time. 
E) grows at the same rate every year. 
A) does not change over time. 
B) grows as the economy grows. 
C) changes over a given business cycle. 
D) declines over time. 
E) grows at the same rate every year.

Question 16

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. 
E) rises by a smaller 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. 
E) rises by a smaller percentage than does GDP during a recession.

Question 17

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

Accepted Answer

A) labour productivity. 
B) savings. 
C) investment. 
D) capital stock. 
E) technology. 
A) labour productivity. 
B) savings. 
C) investment. 
D) capital stock. 
E) technology.

Question 18

A firm can fund an expansion of its operations by

Accepted Answer

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

Question 19

Inflation is measured

Accepted Answer

A) using the level of the consumer price index. 
B) as the percentage change in the consumer price index. 
C) using the level of real GDP. 
D) as the percentage change in real GDP. 
E) as the change in the value of the Canadian dollar. 
A) using the level of the consumer price index. 
B) as the percentage change in the consumer price index. 
C) using the level of real GDP. 
D) as the percentage change in real GDP. 
E) as the change in the value of the Canadian dollar.

Question 20

The sustainability of India's economic growth is particularly threatened by

Accepted Answer

A) a weak public education system 
B) poor access to international capital markets 
C) a lack of telecommunications companies 
D) a lack of access to international markets in goods and services 
E) the lack of "tech" sector 
A) a weak public education system 
B) poor access to international capital markets 
C) a lack of telecommunications companies 
D) a lack of access to international markets in goods and services 
E) the lack of "tech" sector

During the recession phase of the business cycle

According to the commonly used definition, Canada has experienced ________ recession(s)since 1980.

If real GDP grows by 3% in 2013, 3.2% in 2014, and 2.5% in 2015, what is the average annual growth rate of real GDP?

If the CPI is currently 202, what does this tell you about inflation between last year and this year?

In a closed economy, what is the relationship between saving and investment?

Market economies tend to grow more quickly than centrally-planned economies.

How will an increase in the government budget surplus as a result of lower government spending (with no change in net taxes)affect private saving in the economy?

Technological advances generally result in

The generally accepted definition of a recession is

What is the name of the organization that officially defines business cycle peaks and troughs in Canada?

The supply of loanable funds has a slope because the greater the interest rate, the the reward to saving, and the the quantity of loanable funds supplied.

The quantity of goods and services that can be produced by one worker or by one hour of work is referred to as

________ are financial securities that represent partial ownership of a firm.

Potential GDP in Canada

The demand for durable goods

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

A firm can fund an expansion of its operations by

Inflation is measured

The sustainability of India's economic growth is particularly threatened by

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Supply and Demand

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 Bank of Canada

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Bank of Canada Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Exam 6: Economic Growth, The Financial System, and Business Cycles

During the recession phase of the business cycle

According to the commonly used definition, Canada has experienced ________ recession(s)since 1980.

If real GDP grows by 3% in 2013, 3.2% in 2014, and 2.5% in 2015, what is the average annual growth rate of real GDP?

If the CPI is currently 202, what does this tell you about inflation between last year and this year?

In a closed economy, what is the relationship between saving and investment?

Market economies tend to grow more quickly than centrally-planned economies.

How will an increase in the government budget surplus as a result of lower government spending (with no change in net taxes)affect private saving in the economy?

Technological advances generally result in

The generally accepted definition of a recession is

What is the name of the organization that officially defines business cycle peaks and troughs in Canada?

The supply of loanable funds has a ________ slope because the greater the interest rate, the ________ the reward to saving, and the ________ the quantity of loanable funds supplied.

The quantity of goods and services that can be produced by one worker or by one hour of work is referred to as

________ are financial securities that represent partial ownership of a firm.

Potential GDP in Canada

The demand for durable goods

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

A firm can fund an expansion of its operations by

Inflation is measured

The sustainability of India's economic growth is particularly threatened by

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Supply and Demand

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 Bank of Canada

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Bank of Canada Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

The supply of loanable funds has a slope because the greater the interest rate, the the reward to saving, and the the quantity of loanable funds supplied.