Question 1

India's rapid growth can be explained by

Accepted Answer

A) reduced regulations and market-based reforms. 
B) investment in human capital from 1947 through 2015. 
C) the movement of workers from the agricultural sector to the manufacturing sector. 
D) an increase in labor force participation. 
A) reduced regulations and market-based reforms. 
B) investment in human capital from 1947 through 2015. 
C) the movement of workers from the agricultural sector to the manufacturing sector. 
D) an increase in labor force participation.

Question 2

One difference between stocks and bonds is that

Accepted Answer

A) stocks are financial securities,while bonds are labor market securities. 
B) stocks are usually issued in electronic form,while bonds are usually issued in paper form. 
C) stocks represent ownership in companies,while bonds represent ownership in banks. 
D) stocks do not involve a promise to repay a purchaser of the stock,while bonds represent a promise to repay the purchase price of the bond. 
A) stocks are financial securities,while bonds are labor market securities. 
B) stocks are usually issued in electronic form,while bonds are usually issued in paper form. 
C) stocks represent ownership in companies,while bonds represent ownership in banks. 
D) stocks do not involve a promise to repay a purchaser of the stock,while bonds represent a promise to repay the purchase price of the bond.

Question 3

There is a federal budget deficit when

Accepted Answer

A) the government spends less that it collects in taxes. 
B) the government spends more that it collects in taxes. 
C) the government spends the same amount it collects in taxes. 
D) taxes are too high. 
A) the government spends less that it collects in taxes. 
B) the government spends more that it collects in taxes. 
C) the government spends the same amount it collects in taxes. 
D) taxes are too high.

Question 4

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

Accepted Answer

When government spending increases,gover

Question 5

As the economy nears the end of a recession,which of the following do we typically see?

Accepted Answer

A) further decreases in consumer spending 
B) increased spending on capital goods by firms 
C) increasing interest rates 
D) all of the above 
A) further decreases in consumer spending 
B) increased spending on capital goods by firms 
C) increasing interest rates 
D) all of the above

Question 6

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 7

The Business Cycle Dating Committee defines a recession as

Accepted Answer

A) two consecutive quarters of declining real GDP. 
B) two consecutive quarters of declining nominal GDP. 
C) a significant decline in activity visible in industrial production,employment,real income,and wholesale/retail trade lasting more than a few months. 
D) a significant decline in inflation and unemployment lasting more than a few months. 
A) two consecutive quarters of declining real GDP. 
B) two consecutive quarters of declining nominal GDP. 
C) a significant decline in activity visible in industrial production,employment,real income,and wholesale/retail trade lasting more than a few months. 
D) a significant decline in inflation and unemployment lasting more than a few months.

Question 8

If there is public dissaving,investment spending in the economy will decline,holding everything else constant.

Accepted Answer

A) True 
 B)False

Question 9

Growth in potential GDP in the United States is estimated to be about

Accepted Answer

A) 8.25% per year. 
B) 5.0% per year. 
C) 3.2% per year. 
D) 1.5% per year. 
A) 8.25% per year. 
B) 5.0% per year. 
C) 3.2% per year. 
D) 1.5% per year.

Question 10

If real GDP grows by 3% in 2014,3.2% in 2015,and 2.5% in 2016,what is the average annual growth rate of real GDP?

Accepted Answer

A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2% 
A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2%

Question 11

At the end of World War II in 1945,many economists and business managers expected that the U.S.economy would enter a severe recession.At that time,Sears and Montgomery Ward were the two largest department store chains in the country.Sears CEO Robert Wood expected continuing prosperity and opened new stores.Montgomery Ward CEO Sewell Avery expected falling incomes and rising unemployment and closed a number of existing stores.The results of their actions were seen during the late 1940s,when

Accepted Answer

A) Sears declared bankruptcy and was purchased by Montgomery Ward. 
B) Montgomery Ward weathered the economic downturn in better financial shape than Sears. 
C) Sears rapidly gained market share at Montgomery Ward's expense. 
D) Sears had to close many of the new stores it had opened following the end of the war. 
A) Sears declared bankruptcy and was purchased by Montgomery Ward. 
B) Montgomery Ward weathered the economic downturn in better financial shape than Sears. 
C) Sears rapidly gained market share at Montgomery Ward's expense. 
D) Sears had to close many of the new stores it had opened following the end of the war.

Question 12

A(n)________ comes to an end with a business cycle ________.

Accepted Answer

A) recession;peak 
B) recession;trough 
C) expansion;trough 
D) expansion;bubble 
A) recession;peak 
B) recession;trough 
C) expansion;trough 
D) expansion;bubble

Question 13

Potential GDP refers to

Accepted Answer

A) the level of GDP attained when all firms are producing at capacity. 
B) the level of GDP attained by the country with the highest growth in real GDP in a given year. 
C) the difference between the highest level of real GDP per quarter and the lowest level of real GDP per quarter within any given year. 
D) the extent to which real GDP is above or below nominal GDP. 
A) the level of GDP attained when all firms are producing at capacity. 
B) the level of GDP attained by the country with the highest growth in real GDP in a given year. 
C) the difference between the highest level of real GDP per quarter and the lowest level of real GDP per quarter within any given year. 
D) the extent to which real GDP is above or below nominal GDP.

Question 14

During an expansion,how do inflation and unemployment typically change?

Accepted Answer

A) Inflation and unemployment both rise. 
B) Inflation and unemployment both fall. 
C) Inflation falls and unemployment rises. 
D) Inflation rises and unemployment falls. 
A) Inflation and unemployment both rise. 
B) Inflation and unemployment both fall. 
C) Inflation falls and unemployment rises. 
D) Inflation rises and unemployment falls.

Question 15

What type of consumer goods are most affected by the business cycle: durable goods or nondurable goods? Why?

Accepted Answer

Some workers lose income during a recess

Question 16

If an economy is growing at a rate of 2.5% per year,how long will it take the economy to double in size?

Accepted Answer

A) 60 years 
B) 43 years 
C) 36 years 
D) 28 years 
A) 60 years 
B) 43 years 
C) 36 years 
D) 28 years

Question 17

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 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

Market economies tend to grow more quickly than centrally-planned economies.

Accepted Answer

A) True 
 B)False

Question 20

Suppose that real GDP for 2015 was $10,000 billion and real GDP for 2016 was $11,000 billion.What is the rate of growth of real GDP between 2015 and 2016?

Accepted Answer

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

India's rapid growth can be explained by

One difference between stocks and bonds is that

There is a federal budget deficit when

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

As the economy nears the end of a recession,which of the following do we typically see?

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

The Business Cycle Dating Committee defines a recession as

If there is public dissaving,investment spending in the economy will decline,holding everything else constant.

Growth in potential GDP in the United States is estimated to be about

If real GDP grows by 3% in 2014,3.2% in 2015,and 2.5% in 2016,what is the average annual growth rate of real GDP?

A(n) comes to an end with a business cycle .

Potential GDP refers to

During an expansion,how do inflation and unemployment typically change?

What type of consumer goods are most affected by the business cycle: durable goods or nondurable goods? Why?

If an economy is growing at a rate of 2.5% per year,how long will it take the economy to double in size?

Since 1950,

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.

Market economies tend to grow more quickly than centrally-planned economies.

Suppose that real GDP for 2015 was $10,000 billion and real GDP for 2016 was $11,000 billion.What is the rate of growth of real GDP between 2015 and 2016?

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

India's rapid growth can be explained by

One difference between stocks and bonds is that

There is a federal budget deficit when

Explain and show graphically how an increase in government spending affects the equilibrium interest rate in the market for loanable funds.

As the economy nears the end of a recession,which of the following do we typically see?

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

The Business Cycle Dating Committee defines a recession as

If there is public dissaving,investment spending in the economy will decline,holding everything else constant.

Growth in potential GDP in the United States is estimated to be about

If real GDP grows by 3% in 2014,3.2% in 2015,and 2.5% in 2016,what is the average annual growth rate of real GDP?

A(n)________ comes to an end with a business cycle ________.

Potential GDP refers to

During an expansion,how do inflation and unemployment typically change?

What type of consumer goods are most affected by the business cycle: durable goods or nondurable goods? Why?

If an economy is growing at a rate of 2.5% per year,how long will it take the economy to double in size?

Since 1950,

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.

Market economies tend to grow more quickly than centrally-planned economies.

Suppose that real GDP for 2015 was $10,000 billion and real GDP for 2016 was $11,000 billion.What is the rate of growth of real GDP between 2015 and 2016?

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(n) comes to an end with a business cycle .