Question 1

Each phase of a business cycle has approximately the same duration.

Accepted Answer

A) True 
 B)False

Question 2

What is the "crowding out" effect?

Accepted Answer

A) Consumption spending is reduced because of spending on capital 
B) Capital spending is reduced because people purchase great quantities of consumer goods 
C) Private investment is reduced because government borrowing diverts dollars away 
D) Government spending creates a larger demand for capital goods 
E) Savings is insufficient to support the level of capital investment in the economy 
A) Consumption spending is reduced because of spending on capital 
B) Capital spending is reduced because people purchase great quantities of consumer goods 
C) Private investment is reduced because government borrowing diverts dollars away 
D) Government spending creates a larger demand for capital goods 
E) Savings is insufficient to support the level of capital investment in the economy

Question 3

An exceptionally strong and prolonged contraction is known as

Accepted Answer

A) A trough 
B) A recession 
C) An economic bust 
D) A super contraction 
E) A business cycle 
A) A trough 
B) A recession 
C) An economic bust 
D) A super contraction 
E) A business cycle

Question 4

When the economy ends an expansion,it enters which phase of the business cycle?

Accepted Answer

A) Expansion 
B) Peak 
C) Contraction 
D) Trough 
E) Depression 
A) Expansion 
B) Peak 
C) Contraction 
D) Trough 
E) Depression

Question 5

Real business cycle theorists postulate that economic fluctuations are primarily due to changes in aggregate demanD.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following terms is used to describe the purchase of capital?

Accepted Answer

A) Savings 
B) Consumption 
C) Technology 
D) Investment 
E) Production 
A) Savings 
B) Consumption 
C) Technology 
D) Investment 
E) Production

Question 7

The index of leading economic indicators is used by economists to forecast changes in economic performance over timE.

Accepted Answer

A) True 
 B)False

Question 8

Joseph Schumpeter theorized that business cycles were determined primarily by long-run waves of innovation.

Accepted Answer

A) True 
 B)False

Question 9

What is the average length of a typical business cycle in the modern U.S.economy?

Accepted Answer

A) 12 months 
B) 36 months 
C) 60 months 
D) 95 months 
E) 120 months 
A) 12 months 
B) 36 months 
C) 60 months 
D) 95 months 
E) 120 months

Question 10

The Following Questions Refer to the graph below.  
-A movement from point D to point C is consistent with

Accepted Answer

A) An increase in capital goods without a decrease in consumer goods 
B) Technological change between 2012 and 2017 
C) An increase in productivity between 2012 and 2017 
D) All of the above 
E) None of the above 
A) An increase in capital goods without a decrease in consumer goods 
B) Technological change between 2012 and 2017 
C) An increase in productivity between 2012 and 2017 
D) All of the above 
E) None of the above

Question 11

The quantity of capital in the U.S.economy has grown at a rate ________ the growth in the labor forcE.

Accepted Answer

A) Slower than 
B) About the same as 
C) Faster than 
D) Only half as much as 
E) Unknown 
A) Slower than 
B) About the same as 
C) Faster than 
D) Only half as much as 
E) Unknown

Question 12

What was the first theory put forth by an economist to explain the phenomena of business cycles?

Accepted Answer

A) Inventory theory 
B) Schumpeter's theory of innovation 
C) Real business cycle theories 
D) Theory of expectations 
E) Jevons' sunspot theory 
A) Inventory theory 
B) Schumpeter's theory of innovation 
C) Real business cycle theories 
D) Theory of expectations 
E) Jevons' sunspot theory

Question 13

Productivity is not influenced by the law of diminishing returns.

Accepted Answer

A) True 
 B)False

Question 14

As an economy's labor force increases in size,its production possibilities frontier shifts outwarD.

Accepted Answer

A) True 
 B)False

Question 15

The components of the Index of Leading Economic Indicators lead changes in the aggregate economy,but move in an opposite direction.

Accepted Answer

A) True 
 B)False

Question 16

How do you calculate the average product of labor?

Accepted Answer

A) Total quantity of inputs divided by total output 
B) The average number of workers times the average level of output produced 
C) Total output produced divided by total units of labor employed 
D) Total units of labor employed divided by the total output produced 
E) The average number of labor units employed times the quantity of capital employed 
A) Total quantity of inputs divided by total output 
B) The average number of workers times the average level of output produced 
C) Total output produced divided by total units of labor employed 
D) Total units of labor employed divided by the total output produced 
E) The average number of labor units employed times the quantity of capital employed

Question 17

Which of the following is a "pro-growth" economic policy?

Accepted Answer

A) Raising the tax on capital gains 
B) Encouraging people to save less 
C) Reducing public dollars available for education 
D) Investing in human capital 
E) None of the above 
A) Raising the tax on capital gains 
B) Encouraging people to save less 
C) Reducing public dollars available for education 
D) Investing in human capital 
E) None of the above

Question 18

Which phase of the business cycle best describes an economy that is experiencing a positive rate of economic growth?

Accepted Answer

A) Expansion 
B) Peak 
C) Contraction 
D) Trough 
E) Depression 
A) Expansion 
B) Peak 
C) Contraction 
D) Trough 
E) Depression

Each phase of a business cycle has approximately the same duration.

What is the "crowding out" effect?

An exceptionally strong and prolonged contraction is known as

When the economy ends an expansion,it enters which phase of the business cycle?

Real business cycle theorists postulate that economic fluctuations are primarily due to changes in aggregate demanD.

Which of the following terms is used to describe the purchase of capital?

The index of leading economic indicators is used by economists to forecast changes in economic performance over timE.

Joseph Schumpeter theorized that business cycles were determined primarily by long-run waves of innovation.

What is the average length of a typical business cycle in the modern U.S.economy?

The Following Questions Refer to the graph below. -A movement from point D to point C is consistent with

The quantity of capital in the U.S.economy has grown at a rate ________ the growth in the labor forcE.

What was the first theory put forth by an economist to explain the phenomena of business cycles?

Productivity is not influenced by the law of diminishing returns.

As an economy's labor force increases in size,its production possibilities frontier shifts outwarD.

The components of the Index of Leading Economic Indicators lead changes in the aggregate economy,but move in an opposite direction.

How do you calculate the average product of labor?

Which of the following is a "pro-growth" economic policy?

Which phase of the business cycle best describes an economy that is experiencing a positive rate of economic growth?

Alleviating Human Misery: The Role of Economic Reasoning

Economic Systems, Resource Allocation, and Social Well-Being: Lessons From Chinas Transition

Government Control of Prices in Mixed Systems: Who Are the Winners and Losers

Pollution Problems: Must We Foul Our Own Nests

Economics of Crime and Its Prevention: How Much Is Too Much

The Economics of Education: Crisis and Reform

Poverty Problems and Discrimination: Why Are so Many Still so Poor

The Economics of Monopoly Power: Can Markets Be Controlled

The Economics of Professional Sports: What Is the Real Score

Competition in the Global Market-Place: Should We Protect Ourselves From International Trade

Money,Banking and the Financial System: Old Problems With New Twists

Unemployment and Inflation: Can We Find a Balance

Government Spending,Taxation,and the National Debt: Who Wins and Who Loses

Social Security and Medicare: How Secure Is Our Safety Net for the Elderly

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Exam 11: Economic Growth: Why Is the Economic Road so Bumpy

Each phase of a business cycle has approximately the same duration.

What is the "crowding out" effect?

An exceptionally strong and prolonged contraction is known as

When the economy ends an expansion,it enters which phase of the business cycle?

Real business cycle theorists postulate that economic fluctuations are primarily due to changes in aggregate demanD.

Which of the following terms is used to describe the purchase of capital?

The index of leading economic indicators is used by economists to forecast changes in economic performance over timE.

Joseph Schumpeter theorized that business cycles were determined primarily by long-run waves of innovation.

What is the average length of a typical business cycle in the modern U.S.economy?

The Following Questions Refer to the graph below. -A movement from point D to point C is consistent with

The quantity of capital in the U.S.economy has grown at a rate ________ the growth in the labor forcE.

What was the first theory put forth by an economist to explain the phenomena of business cycles?

Productivity is not influenced by the law of diminishing returns.

As an economy's labor force increases in size,its production possibilities frontier shifts outwarD.

The components of the Index of Leading Economic Indicators lead changes in the aggregate economy,but move in an opposite direction.

How do you calculate the average product of labor?

Which of the following is a "pro-growth" economic policy?

Which phase of the business cycle best describes an economy that is experiencing a positive rate of economic growth?

Alleviating Human Misery: The Role of Economic Reasoning

Economic Systems, Resource Allocation, and Social Well-Being: Lessons From Chinas Transition

Government Control of Prices in Mixed Systems: Who Are the Winners and Losers

Pollution Problems: Must We Foul Our Own Nests

Economics of Crime and Its Prevention: How Much Is Too Much

The Economics of Education: Crisis and Reform

Poverty Problems and Discrimination: Why Are so Many Still so Poor

The Economics of Monopoly Power: Can Markets Be Controlled

The Economics of Professional Sports: What Is the Real Score

Competition in the Global Market-Place: Should We Protect Ourselves From International Trade

Money,Banking and the Financial System: Old Problems With New Twists

Unemployment and Inflation: Can We Find a Balance

Government Spending,Taxation,and the National Debt: Who Wins and Who Loses

Social Security and Medicare: How Secure Is Our Safety Net for the Elderly

Filters