Question 1

If GDP is currently $13 trillion and is growing at a rate of 2.3% per year,how long will it take GDP to reach $26 trillion?

Accepted Answer

A) about 15 years 
B) about 17 years 
C) about 25 years 
D) about 30 years 
A) about 15 years 
B) about 17 years 
C) about 25 years 
D) about 30 years

Question 2

Since 1900,real GDP in the United States has grown

Accepted Answer

A) more rapidly than the population. 
B) more slowly than the population. 
C) as rapidly as the population. 
D) in a random unpredictable manner relative to the population. 
A) more rapidly than the population. 
B) more slowly than the population. 
C) as rapidly as the population. 
D) in a random unpredictable manner relative to the population.

Question 3

Which of the following statements about the budget deficit is true?

Accepted Answer

A) In 1992,the federal budget was balanced. 
B) In 2000,the federal budget was in surplus. 
C) In 2004,the federal budget was in surplus. 
D) In 2011,the federal budget was in surplus. 
A) In 1992,the federal budget was balanced. 
B) In 2000,the federal budget was in surplus. 
C) In 2004,the federal budget was in surplus. 
D) In 2011,the federal budget was in surplus.

Question 4

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

Question 5

A financial intermediary's main function is to match ________ with excess funds to ________ with a shortage of funds.

Accepted Answer

A) savers; borrower 
B) borrower; savers 
C) governments; households 
D) firms; insurance companies 
A) savers; borrower 
B) borrower; savers 
C) governments; households 
D) firms; insurance companies

Question 6

Explain and show graphically how a decrease in household saving affects the equilibrium interest rate and the equilibrium quantity of loanable funds.

Accepted Answer

A decrease in household saving decreases

Question 7

Inflation usually increases during a recession and decreases during an expansion.

Accepted Answer

A) True 
 B)False

Question 8

Actual real GDP will be above potential GDP if

Accepted Answer

A) firms are producing below capacity. 
B) firms are producing at capacity. 
C) firms are producing above capacity. 
D) inflation is rising. 
A) firms are producing below capacity. 
B) firms are producing at capacity. 
C) firms are producing above capacity. 
D) inflation is rising.

Question 9

If,in a closed economy,real GDP is $30 billion,consumption is $20 billion,and government purchases are $5 billion,what is total saving in the economy?

Accepted Answer

A) $5 billion 
B) $15 billion 
C) $45 billion 
D) $55 billion 
A) $5 billion 
B) $15 billion 
C) $45 billion 
D) $55 billion

Question 10

If real GDP per capita measured in 2009 dollars was $6,000 in 1950 and $48,000 in 2013,we would say that in the year 2013,the average American could buy ________ times as many goods and services as the average American in 1950.

Accepted Answer

A) 1/8 
B) 4 
C) 8 
D) 12 
A) 1/8 
B) 4 
C) 8 
D) 12

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

Use the rule of 70 to illustrate how small differences in growth rates can have a large impact on how rapidly the standard of living in a country increases.

Accepted Answer

The rule of 70 refers to a calculation t

Question 13

Since 1950,

Accepted Answer

A) economic expansions in the United States have been so short that expansions barely exist. 
B) the average length of expansions in the United States have become shorter as compared to before 1950. 
C) the average length of expansions in the United States have become longer as compared to before 1950. 
D) the average length of expansions in the United States are about the same length as compared to before 1950. 
A) economic expansions in the United States have been so short that expansions barely exist. 
B) the average length of expansions in the United States have become shorter as compared to before 1950. 
C) the average length of expansions in the United States have become longer as compared to before 1950. 
D) the average length of expansions in the United States are about the same length as compared to before 1950.

Question 14

Suppose that real GDP for 2012 was $10,000 billion and real GDP for 2013 was $11,000 billion.What is the rate of growth of real GDP between 2012 and 2013?

Accepted Answer

A) 1% 
B) 2% 
C) 5% 
D) 10% 
A) 1% 
B) 2% 
C) 5% 
D) 10%

Question 15

Economic growth depends more on technological change than on increases on capital per hour worked.

Accepted Answer

A) True 
 B)False

Question 16

If you invest $10,000 in a bond that earns 8% interest per year,how many years will it take to double your money?

Accepted Answer

A) 1 year and 3 months 
B) 2 years and 6 months 
C) 8 years 
D) 8 years and 9 months 
A) 1 year and 3 months 
B) 2 years and 6 months 
C) 8 years 
D) 8 years and 9 months

Question 17

Which of the following would contribute to a sustained high rate of economic growth in the long run in an economy?

Accepted Answer

A) growth in capital per hour accompanied by technological change 
B) increases in labor force participation rates as workers who are out of the labor force pursue rising wages 
C) a shift of workers in the economy from the agricultural sector to the nonagricultural sector 
D) an influx of immigrant labor into an economy without any accompanying technological change 
A) growth in capital per hour accompanied by technological change 
B) increases in labor force participation rates as workers who are out of the labor force pursue rising wages 
C) a shift of workers in the economy from the agricultural sector to the nonagricultural sector 
D) an influx of immigrant labor into an economy without any accompanying technological change

Question 18

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 19

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 20

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.

If GDP is currently $13 trillion and is growing at a rate of 2.3% per year,how long will it take GDP to reach $26 trillion?

Since 1900,real GDP in the United States has grown

Which of the following statements about the budget deficit is true?

During the recession phase of the business cycle,

A financial intermediary's main function is to match with excess funds to with a shortage of funds.

Explain and show graphically how a decrease in household saving affects the equilibrium interest rate and the equilibrium quantity of loanable funds.

Inflation usually increases during a recession and decreases during an expansion.

Actual real GDP will be above potential GDP if

If,in a closed economy,real GDP is $30 billion,consumption is $20 billion,and government purchases are $5 billion,what is total saving in the economy?

If real GDP per capita measured in 2009 dollars was $6,000 in 1950 and $48,000 in 2013,we would say that in the year 2013,the average American could buy ________ times as many goods and services as the average American in 1950.

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

Use the rule of 70 to illustrate how small differences in growth rates can have a large impact on how rapidly the standard of living in a country increases.

Since 1950,

Suppose that real GDP for 2012 was $10,000 billion and real GDP for 2013 was $11,000 billion.What is the rate of growth of real GDP between 2012 and 2013?

Economic growth depends more on technological change than on increases on capital per hour worked.

If you invest $10,000 in a bond that earns 8% interest per year,how many years will it take to double your money?

Which of the following would contribute to a sustained high rate of economic growth in the long run in an economy?

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?

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

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

If GDP is currently $13 trillion and is growing at a rate of 2.3% per year,how long will it take GDP to reach $26 trillion?

Since 1900,real GDP in the United States has grown

Which of the following statements about the budget deficit is true?

During the recession phase of the business cycle,

A financial intermediary's main function is to match ________ with excess funds to ________ with a shortage of funds.

Explain and show graphically how a decrease in household saving affects the equilibrium interest rate and the equilibrium quantity of loanable funds.

Inflation usually increases during a recession and decreases during an expansion.

Actual real GDP will be above potential GDP if

If,in a closed economy,real GDP is $30 billion,consumption is $20 billion,and government purchases are $5 billion,what is total saving in the economy?

If real GDP per capita measured in 2009 dollars was $6,000 in 1950 and $48,000 in 2013,we would say that in the year 2013,the average American could buy ________ times as many goods and services as the average American in 1950.

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

Use the rule of 70 to illustrate how small differences in growth rates can have a large impact on how rapidly the standard of living in a country increases.

Since 1950,

Suppose that real GDP for 2012 was $10,000 billion and real GDP for 2013 was $11,000 billion.What is the rate of growth of real GDP between 2012 and 2013?

Economic growth depends more on technological change than on increases on capital per hour worked.

If you invest $10,000 in a bond that earns 8% interest per year,how many years will it take to double your money?

Which of the following would contribute to a sustained high rate of economic growth in the long run in an economy?

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?

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

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

A financial intermediary's main function is to match with excess funds to with a shortage of funds.