Question 1

The Great Depression consisted of how many business cycles?

Accepted Answer

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

Question 2

A decrease in government spending on the park system would cause

Accepted Answer

A) the aggregate demand curve to shift to the right. 
B) the aggregate demand curve to shift to the left. 
C) a movement down and to the right along the aggregate demand curve. 
D) a movement up and to the left along the aggregate demand curve. 
A) the aggregate demand curve to shift to the right. 
B) the aggregate demand curve to shift to the left. 
C) a movement down and to the right along the aggregate demand curve. 
D) a movement up and to the left along the aggregate demand curve.

Question 3

The longest economic expansion in the United States occurred during the

Accepted Answer

A) 1940s. 
B) 1960s. 
C) 1980s. 
D) 1990s. 
A) 1940s. 
B) 1960s. 
C) 1980s. 
D) 1990s.

Question 4

The long boom occurred in the

Accepted Answer

A) 1920s and 1930s. 
B) 1940s and 1950s. 
C) 1960s and 1970s. 
D) 1980s and 1990s. 
A) 1920s and 1930s. 
B) 1940s and 1950s. 
C) 1960s and 1970s. 
D) 1980s and 1990s.

Question 5

The three main components of the aggregate demand-aggregate supply model include

Accepted Answer

A) AD,SRAS,LM. 
B) SRAS,LRAS,IS. 
C) AD,IS,LM. 
D) AD,SRAS,LRAS. 
A) AD,SRAS,LM. 
B) SRAS,LRAS,IS. 
C) AD,IS,LM. 
D) AD,SRAS,LRAS.

Question 6

The longest contraction in American history occurred

Accepted Answer

A) during the 1870s. 
B) in the years right before World War I began. 
C) during the 1930s. 
D) during the 1970s. 
A) during the 1870s. 
B) in the years right before World War I began. 
C) during the 1930s. 
D) during the 1970s.

Question 7

The job finding rate is defined as

Accepted Answer

A) the probability that someone who has been unemployed for over a year will find a job in the next month. 
B) the probability that someone who is not in the labor force will enter the labor force in the next month. 
C) the probability that someone who is employed will change jobs in the next month. 
D) the probability that someone who is unemployed will find a job in the next month. 
A) the probability that someone who has been unemployed for over a year will find a job in the next month. 
B) the probability that someone who is not in the labor force will enter the labor force in the next month. 
C) the probability that someone who is employed will change jobs in the next month. 
D) the probability that someone who is unemployed will find a job in the next month.

Question 8

Which of the following macroeconomic variables is acyclical?

Accepted Answer

A) Real interest rates 
B) Unemployment 
C) Money supply 
D) Consumption 
A) Real interest rates 
B) Unemployment 
C) Money supply 
D) Consumption

Question 9

A decline in the stock market,which makes consumers poorer,would cause

Accepted Answer

A) the aggregate demand curve to shift to the right. 
B) the aggregate demand curve to shift to the left. 
C) a movement down and to the right along the aggregate demand curve. 
D) a movement up and to the left along the aggregate demand curve. 
A) the aggregate demand curve to shift to the right. 
B) the aggregate demand curve to shift to the left. 
C) a movement down and to the right along the aggregate demand curve. 
D) a movement up and to the left along the aggregate demand curve.

Question 10

Who officially determines whether the economy is in a recession or expansion?

Accepted Answer

A) The president of the United States 
B) The U.S.Congress 
C) The Federal Reserve Board of Governors 
D) The National Bureau of Economic Research 
A) The president of the United States 
B) The U.S.Congress 
C) The Federal Reserve Board of Governors 
D) The National Bureau of Economic Research

Question 11

One of the first organizations to investigate the business cycle was

Accepted Answer

A) the Federal Reserve System. 
B) the National Bureau of Economic Research. 
C) the Council of Economic Advisors. 
D) the Brookings Institution. 
A) the Federal Reserve System. 
B) the National Bureau of Economic Research. 
C) the Council of Economic Advisors. 
D) the Brookings Institution.

Question 12

In the long run,an increase in productivity would cause output to ________ and the aggregate price level to ________.

Accepted Answer

A) fall; rise 
B) fall; fall 
C) rise; fall 
D) rise; rise 
A) fall; rise 
B) fall; fall 
C) rise; fall 
D) rise; rise

Question 13

Stock and Watson found that ________ was responsible for about 20-30 % of the reduction in output volatility that occurred in the mid-1980s.

Accepted Answer

A) reduced shocks to productivity 
B) reduced shocks to food and commodity prices 
C) better monetary policy 
D) better inventory control 
A) reduced shocks to productivity 
B) reduced shocks to food and commodity prices 
C) better monetary policy 
D) better inventory control

Question 14

Turning points in business cycles occur when

Accepted Answer

A) a new business cycle is initiated at the trough. 
B) the economy hits the peak or trough in the business cycle. 
C) the business cycle begins to follow a new pattern that differs from previous business cycles. 
D) a new business cycle is initiated at the peak. 
A) a new business cycle is initiated at the trough. 
B) the economy hits the peak or trough in the business cycle. 
C) the business cycle begins to follow a new pattern that differs from previous business cycles. 
D) a new business cycle is initiated at the peak.

Question 15

Suppose the economy is initially in long-run equilibrium.For each of the shocks listed below,explain the long-run effects on output and the price level.
(a)Labor supply decreases.
(b)The government shuts down the Bureau of Economic Analysis.
(c)Productivity increases.

Accepted Answer

(a)Output declines and the pri

Question 16

Suppose the economy is initially in long-run equilibrium.For each of the shocks listed below,explain the short-run effects on output and the price level.
(a)A stock market crash reduces consumers' wealth.
(b)Businesses decide to hold larger inventories.
(c)The government cuts defense spending.
(d)Foreign countries buy more U.S.goods.

Accepted Answer

(a)Output declines and the price level i

Question 17

The high point in the business cycle is referred to as the

Accepted Answer

A) turning point. 
B) peak. 
C) boom. 
D) trough. 
A) turning point. 
B) peak. 
C) boom. 
D) trough.

Question 18

Suppose labor supply declined.Would this affect the aggregate demand curve or the aggregate supply curve? What would be the effect on output and the price level?

Accepted Answer

The decline in the labor suppl

Question 19

Real interest rates are

Accepted Answer

A) procyclical,just like nominal interest rates. 
B) acyclical,while nominal interest rates are procyclical. 
C) acyclical,just like nominal interest rates. 
D) countercyclical,while nominal interest rates are procyclical. 
A) procyclical,just like nominal interest rates. 
B) acyclical,while nominal interest rates are procyclical. 
C) acyclical,just like nominal interest rates. 
D) countercyclical,while nominal interest rates are procyclical.

Question 20

After a shift in the aggregate demand curve,which variable adjusts to restore general equilibrium?

Accepted Answer

A) price level 
B) real interest rate 
C) consumption spending 
D) investment spending 
A) price level 
B) real interest rate 
C) consumption spending 
D) investment spending

The Great Depression consisted of how many business cycles?

A decrease in government spending on the park system would cause

The longest economic expansion in the United States occurred during the

The long boom occurred in the

The three main components of the aggregate demand-aggregate supply model include

The longest contraction in American history occurred

The job finding rate is defined as

Which of the following macroeconomic variables is acyclical?

A decline in the stock market,which makes consumers poorer,would cause

Who officially determines whether the economy is in a recession or expansion?

One of the first organizations to investigate the business cycle was

In the long run,an increase in productivity would cause output to and the aggregate price level to .

Stock and Watson found that ________ was responsible for about 20-30 % of the reduction in output volatility that occurred in the mid-1980s.

Turning points in business cycles occur when

Suppose the economy is initially in long-run equilibrium.For each of the shocks listed below,explain the long-run effects on output and the price level. (a)Labor supply decreases. (b)The government shuts down the Bureau of Economic Analysis. (c)Productivity increases.

The high point in the business cycle is referred to as the

Suppose labor supply declined.Would this affect the aggregate demand curve or the aggregate supply curve? What would be the effect on output and the price level?

Real interest rates are

After a shift in the aggregate demand curve,which variable adjusts to restore general equilibrium?

Introduction to Macroeconomics

The Measurement and Structure of the National Economy

Productivity, Output, and Employment

Consumption, Saving, and Investment

Saving and Investment in the Open Economy

Long-Run Economic Growth

The Asset Market, Money, and Prices

The IS-LM/AD-AS Model

Classical Business Cycle Analysis

Keynesianism: The Macroeconomics of Wage and Price Rigidity

Unemployment and Inflation

Exchange Rates,Business Cycles,and Macroeconomic Policy in the Open Economy

Monetary Policy and the Federal Reserve System

Government Spending and Its Financing

Filters

Exam 8: Business Cycles

The Great Depression consisted of how many business cycles?

A decrease in government spending on the park system would cause

The longest economic expansion in the United States occurred during the

The long boom occurred in the

The three main components of the aggregate demand-aggregate supply model include

The longest contraction in American history occurred

The job finding rate is defined as

Which of the following macroeconomic variables is acyclical?

A decline in the stock market,which makes consumers poorer,would cause

Who officially determines whether the economy is in a recession or expansion?

One of the first organizations to investigate the business cycle was

In the long run,an increase in productivity would cause output to ________ and the aggregate price level to ________.

Stock and Watson found that ________ was responsible for about 20-30 % of the reduction in output volatility that occurred in the mid-1980s.

Turning points in business cycles occur when

Suppose the economy is initially in long-run equilibrium.For each of the shocks listed below,explain the long-run effects on output and the price level. (a)Labor supply decreases. (b)The government shuts down the Bureau of Economic Analysis. (c)Productivity increases.

The high point in the business cycle is referred to as the

Suppose labor supply declined.Would this affect the aggregate demand curve or the aggregate supply curve? What would be the effect on output and the price level?

Real interest rates are

After a shift in the aggregate demand curve,which variable adjusts to restore general equilibrium?

Introduction to Macroeconomics

The Measurement and Structure of the National Economy

Productivity, Output, and Employment

Consumption, Saving, and Investment

Saving and Investment in the Open Economy

Long-Run Economic Growth

The Asset Market, Money, and Prices

The IS-LM/AD-AS Model

Classical Business Cycle Analysis

Keynesianism: The Macroeconomics of Wage and Price Rigidity

Unemployment and Inflation

Exchange Rates,Business Cycles,and Macroeconomic Policy in the Open Economy

Monetary Policy and the Federal Reserve System

Government Spending and Its Financing

Filters

In the long run,an increase in productivity would cause output to and the aggregate price level to .