Question 1

A good measure of the standard of living is

Accepted Answer

A)  real GDP per capita. 
B)  nominal GDP per capita. 
C)  total real GDP. 
D)  total nominal GDP. 
A)  real GDP per capita. 
B)  nominal GDP per capita. 
C)  total real GDP. 
D)  total nominal GDP.

Question 2

If government saving is negative,then

Accepted Answer

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

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

Which of the following statements describes the experiences of the Boeing Corporation since it was established in 1916?

Accepted Answer

A)  strong uninterrupted growth in demand 
B)  strong growth interrupted by periods of business cycle recession 
C)  little or no growth in the long run, and unaffected by the business cycle 
D)  little or no growth in the long run, but very vulnerable to the business cycle 
A)  strong uninterrupted growth in demand 
B)  strong growth interrupted by periods of business cycle recession 
C)  little or no growth in the long run, and unaffected by the business cycle 
D)  little or no growth in the long run, but very vulnerable to the business cycle

Question 5

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 6

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

Accepted Answer

A recessionary phase of a business cycle

Question 7

If consumers decide to be more frugal and save more out of their income,then this will cause

Accepted Answer

A)  a shift in the supply curve for loanable funds to the right. 
B)  a shift in the supply curve for loanable funds to the left. 
C)  a movement to the right along the supply curve for loanable funds. 
D)  a movement to the left along the supply curve for loanable funds. 
A)  a shift in the supply curve for loanable funds to the right. 
B)  a shift in the supply curve for loanable funds to the left. 
C)  a movement to the right along the supply curve for loanable funds. 
D)  a movement to the left along the supply curve for loanable funds.

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

Use the equations for public and private saving to demonstrate how total saving in the economy equals investment.

Accepted Answer

Private saving is equal to Y + TR - C -

Question 10

Since 1950,expansions in the United States have become ________,while recessions have become ________.

Accepted Answer

A)  longer; longer 
B)  shorter; shorter 
C)  shorter; longer 
D)  longer; shorter 
A)  longer; longer 
B)  shorter; shorter 
C)  shorter; longer 
D)  longer; shorter

Question 11

A government budget surplus from reduced government spending (no change in net taxes)will ________ the level of investment in the economy and ________ the level of saving (private plus public)in the economy.

Accepted Answer

A)  increase; decrease 
B)  increase; increase 
C)  decrease; increase 
D)  decrease; decrease 
A)  increase; decrease 
B)  increase; increase 
C)  decrease; increase 
D)  decrease; decrease

Question 12

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 13

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)  labor productivity. 
C)  real GDP. 
D)  human capital. 
A)  technology. 
B)  labor productivity. 
C)  real GDP. 
D)  human capital.

Question 14

Which of the following would encourage economic growth through increases in the capital stock?

Accepted Answer

A)  a change from an income tax to a consumption tax 
B)  an increase in household saving 
C)  a decrease in the government deficit 
D)  all of the above 
A)  a change from an income tax to a consumption tax 
B)  an increase in household saving 
C)  a decrease in the government deficit 
D)  all of the above

Question 15

In a closed economy,which of the following equations reflects investment? (Y = GDP,C = Consumption,G = Government purchases,T = Taxes,and TR = Transfers)

Accepted Answer

A)  Y - C - G 
B)  Y - C - T 
C)  Y - T + TR 
D)  C + G -T 
A)  Y - C - G 
B)  Y - C - T 
C)  Y - T + TR 
D)  C + G -T

Question 16

In an open economy,there is interaction with other economies in terms of both trading of goods and services and borrowing and lending.

Accepted Answer

A) True 
 B)False

Question 17

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 18

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 19

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 20

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

Exam 21: Economic Growth, the Financial System, and Business Cycles

A good measure of the standard of living is

If government saving is negative,then

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

Which of the following statements describes the experiences of the Boeing Corporation since it was established in 1916?

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

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

If consumers decide to be more frugal and save more out of their income,then this will cause

Actual real GDP will be above potential GDP if

Use the equations for public and private saving to demonstrate how total saving in the economy equals investment.

Since 1950,expansions in the United States have become ________,while recessions have become ________.

A government budget surplus from reduced government spending (no change in net taxes)will ________ the level of investment in the economy and ________ the level of saving (private plus public)in the economy.

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

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

Which of the following would encourage economic growth through increases in the capital stock?

In a closed economy,which of the following equations reflects investment? (Y = GDP,C = Consumption,G = Government purchases,T = Taxes,and TR = Transfers)

In an open economy,there is interaction with other economies in terms of both trading of goods and services and borrowing and lending.

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

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.

Long-run economic growth requires all of the following except

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.

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

Externalities, environmental Policy, and Public Goods

Elasticity: The Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: The Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

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

Since 1950,expansions in the United States have become ,while recessions have become .

A government budget surplus from reduced government spending (no change in net taxes)will the level of investment in the economy and the level of saving (private plus public)in the economy.