Question 1

Following a trough, real GDP increases.

Accepted Answer

A) True 
 B)False

Question 2

When an economy is operating between a trough and a peak of the business cycle, it is in:

Accepted Answer

A) an expansion. 
B) a contraction. 
C) a short-run condition. 
D) the beginning of a fall in aggregate spending. 
A) an expansion. 
B) a contraction. 
C) a short-run condition. 
D) the beginning of a fall in aggregate spending.

Question 3

In macroeconomics:

Accepted Answer

A) aggregate data such as real GDP, the price level, and unemployment are analyzed. 
B) individual and firm decisions regarding utility and profit maximization are studied. 
C) long-term growth is not considered to be important. 
D) market intervention from the government is not considered important. 
A) aggregate data such as real GDP, the price level, and unemployment are analyzed. 
B) individual and firm decisions regarding utility and profit maximization are studied. 
C) long-term growth is not considered to be important. 
D) market intervention from the government is not considered important.

Question 4

The business cycle is the long-run alternation between downturns and upturns.

Accepted Answer

A) True 
 B)False

Question 5

A recession leads to all of the following EXCEPT:

Accepted Answer

A) higher unemployment. 
B) reduced output. 
C) reduced income and living standards. 
D) higher employment. 
A) higher unemployment. 
B) reduced output. 
C) reduced income and living standards. 
D) higher employment.

Question 6

The alternation between recessions and expansions is known as the:

Accepted Answer

A) unemployment rate. 
B) long-run economic growth. 
C) business cycle. 
D) macroeconomy. 
A) unemployment rate. 
B) long-run economic growth. 
C) business cycle. 
D) macroeconomy.

Question 7

An open economy:

Accepted Answer

A) trades goods and services with other countries. 
B) does not regulate its industries. 
C) does not impose taxes on its citizens. 
D) allows free practice of speech and religion. 
A) trades goods and services with other countries. 
B) does not regulate its industries. 
C) does not impose taxes on its citizens. 
D) allows free practice of speech and religion.

Question 8

Which one of the following measures long-run economic growth?

Accepted Answer

A) a rise in employment 
B) an increase in the money supply 
C) a sustained increase in the production of goods and services 
D) an increase in the labor force 
A) a rise in employment 
B) an increase in the money supply 
C) a sustained increase in the production of goods and services 
D) an increase in the labor force

Question 9

The topics studied in macroeconomics include:

Accepted Answer

A) inflation. 
B) monopolies. 
C) spillovers, such as pollution. 
D) mergers. 
A) inflation. 
B) monopolies. 
C) spillovers, such as pollution. 
D) mergers.

Question 10

When overall price levels rise over time, it is referred to as:

Accepted Answer

A) deflation. 
B) inflation. 
C) an increase in purchasing power. 
D) the consumer price index. 
A) deflation. 
B) inflation. 
C) an increase in purchasing power. 
D) the consumer price index.

Question 11

The topics studied in macroeconomics include:

Accepted Answer

A) inflation. 
B) unemployment. 
C) economic growth. 
D) inflation, unemployment, and economic growth. 
A) inflation. 
B) unemployment. 
C) economic growth. 
D) inflation, unemployment, and economic growth.

Question 12

During the Great Depression, unemployment rates reached as high as:

Accepted Answer

A) 25%. 
B) 50%. 
C) 10%. 
D) 60%. 
A) 25%. 
B) 50%. 
C) 10%. 
D) 60%.

Question 13

Recessions are periods in which output and employment are falling.

Accepted Answer

A) True 
 B)False

Question 14

Inflation:

Accepted Answer

A) raises the cost of making purchases. 
B) can result in a decrease in barter transactions. 
C) encourages people to hold cash. 
D) is caused by changes in interest rates. 
A) raises the cost of making purchases. 
B) can result in a decrease in barter transactions. 
C) encourages people to hold cash. 
D) is caused by changes in interest rates.

Question 15

"Macroeconomics is nothing but a simple aggregation of all the microeconomic parts." Do you agree or disagree with this statement?

Accepted Answer

A) Don't agree; there is a lot more to the study of macroeconomics than the sum of its microeconomic parts. 
B) Agree; macroeconomics is exactly equal to the total of all microeconomic units. 
C) Don't agree; these two disciplines deal with completely independent issues. 
D) Don't agree; microeconomics is an aggregation of all the macroeconomic parts. 
A) Don't agree; there is a lot more to the study of macroeconomics than the sum of its microeconomic parts. 
B) Agree; macroeconomics is exactly equal to the total of all microeconomic units. 
C) Don't agree; these two disciplines deal with completely independent issues. 
D) Don't agree; microeconomics is an aggregation of all the macroeconomic parts.

Question 16

An economic recovery encompasses all of the following EXCEPT:

Accepted Answer

A) sustained economic growth. 
B) a short-run increase in aggregate production. 
C) a time of increasing employment. 
D) the end of the business cycle. 
A) sustained economic growth. 
B) a short-run increase in aggregate production. 
C) a time of increasing employment. 
D) the end of the business cycle.

Question 17

Keynesian economics stressed:

Accepted Answer

A) the importance of total spending. 
B) the self-correcting power of free markets. 
C) the long run. 
D) that the Depression should run its course to bring down the high cost of living. 
A) the importance of total spending. 
B) the self-correcting power of free markets. 
C) the long run. 
D) that the Depression should run its course to bring down the high cost of living.

Question 18

An open economy:

Accepted Answer

A) trades only with its neighbors. 
B) trades goods but not services or assets with other countries. 
C) does not trade goods, services, or assets with other countries. 
D) trades goods and services with other countries. 
A) trades only with its neighbors. 
B) trades goods but not services or assets with other countries. 
C) does not trade goods, services, or assets with other countries. 
D) trades goods and services with other countries.

Question 19

Use the following to answer questions:
Figure: The Business Cycle  
-(Figure: The Business Cycle) Look at the figure The Business Cycle. Point B on this graph shows a(n):

Accepted Answer

A) peak. 
B) trough. 
C) expansion. 
D) recession. 
A) peak. 
B) trough. 
C) expansion. 
D) recession.

Question 20

The most painful consequence of a recession is:

Accepted Answer

A) rising unemployment. 
B) increasing inflation. 
C) increasing aggregate output. 
D) higher interest rates. 
A) rising unemployment. 
B) increasing inflation. 
C) increasing aggregate output. 
D) higher interest rates.

Following a trough, real GDP increases.

When an economy is operating between a trough and a peak of the business cycle, it is in:

In macroeconomics:

The business cycle is the long-run alternation between downturns and upturns.

A recession leads to all of the following EXCEPT:

The alternation between recessions and expansions is known as the:

An open economy:

Which one of the following measures long-run economic growth?

The topics studied in macroeconomics include:

When overall price levels rise over time, it is referred to as:

The topics studied in macroeconomics include:

During the Great Depression, unemployment rates reached as high as:

Recessions are periods in which output and employment are falling.

Inflation:

"Macroeconomics is nothing but a simple aggregation of all the microeconomic parts." Do you agree or disagree with this statement?

An economic recovery encompasses all of the following EXCEPT:

Keynesian economics stressed:

An open economy:

Use the following to answer questions: Figure: The Business Cycle -(Figure: The Business Cycle) Look at the figure The Business Cycle. Point B on this graph shows a(n):

The most painful consequence of a recession is:

First Principles

Economic Models

Supply and Demand

International Trade 5

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters

Exam 6: Macroeconomics: the Big Picture

Following a trough, real GDP increases.

When an economy is operating between a trough and a peak of the business cycle, it is in:

In macroeconomics:

The business cycle is the long-run alternation between downturns and upturns.

A recession leads to all of the following EXCEPT:

The alternation between recessions and expansions is known as the:

An open economy:

Which one of the following measures long-run economic growth?

The topics studied in macroeconomics include:

When overall price levels rise over time, it is referred to as:

The topics studied in macroeconomics include:

During the Great Depression, unemployment rates reached as high as:

Recessions are periods in which output and employment are falling.

Inflation:

"Macroeconomics is nothing but a simple aggregation of all the microeconomic parts." Do you agree or disagree with this statement?

An economic recovery encompasses all of the following EXCEPT:

Keynesian economics stressed:

An open economy:

Use the following to answer questions: Figure: The Business Cycle -(Figure: The Business Cycle) Look at the figure The Business Cycle. Point B on this graph shows a(n):

The most painful consequence of a recession is:

First Principles

Economic Models

Supply and Demand

International Trade 5

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters