Click on the Link Below to
Purchase A+ Graded Course Material
Chapter 1
TRUE/FALSE
1. Macroeconomists
study the amount of employment and unemployment.
2. Macroeconomists
study the price of individual products like beer.
3. When
the gross domestic product is growing, it is called inflation.
4. A
recession is when GDP is falling toward a trough.
5. If
price is below equilibrium in a market, then quantity supplied will be less
than quantity demanded.
6. The
annual inflation rate measures the annual percentage growth in the overall
price level.
7. The
annual inflation rate measures the growth in the prices of oil and food only.
8. Endogenous
variables in an economic model are those that the model takes as given and does
not try to explain.
9. Exogenous
variables in an economic model are those that the model takes as given and does
not try to explain.
10. In
a model with perfect competition, both buyers and sellers take the price of a
good as given.
MULTIPLE CHOICE
1. Macroeconomics
deals with:
a. how individual markets work.
b. the overall performance of the economy.
c. relative prices in different markets.
d. substitution of one good for another
good.
2. Macroeconomics
includes the study of:
a. the general price level. c. the
relative price of goods.
b. the price of individual goods. d. all
of the above.
3. Macroeconomists
study:
a. the determination of the economy’s
total production.
b. unemployment
c. the general price level.
d. all of the above.
4. Macroeconomists
study:
a. the determination of real GDP.
b. the production of specific goods.
c. the relative production in different
markets.
d. all of the above.
5. Among
the prices that macroeconomist study are:
a. the price of coffee. c. the
interest rate.
b. the price of tea. d. all
of the above.
6. Among
the prices that macroeconomists study are:
a. the wage rate. c. the exchange rate.
b. the interest rate. d. all
of the above.
7. Monetary
policy involves:
a. the government’s expenditure. c. determining
the quantity of money.
b. taxation. d. the fiscal
deficit.
8. The
unemployment rate is:
a. the fraction of the population with no
job.
b. the fraction of those seeking work with
no job.
c. the rate of growth of those with no
job.
d. the rate of growth of those seeking
work.
9. Fiscal
policy involves:
a. determining exchange rates. c. interest
rates.
b. government expenditures. d. all
of the above.
10. The
rate of growth of GDP for period t is:
a. c.
b. d.
11. Variations
in real GDP are called:
a. inflation. c. economic
fluctuations.
b. deflation. d. all of the
above.
12. When
GDP is expanding toward a high point it is called a[n]:
a. depression. c. recession.
b. boom. d. inflation.
13. When
real GDP falls toward a low point or trough it is called a[n]:
a. boom. c. inflation.
b. recession. d. expansion.
14. During
recessions the unemployment rate:
a. declines. c. is stable.
b. increases. d. is
unmeasureable.
15. The
unemployment rate in the US was highest in the:
a. 1990s c. 1980s
b. 1930s d. 1950s
16. The
inflation rate for year t is:
a. c.
b. d.
17. A
variable that macroeconomists want to model is a[n]
a. endogenous variable. c. exogenous
variable.
b. dummy variable. d. predetermined
variable.
18. A
variable taken as given in a model is a[n]
a. endogenous variable. c. exogenous
variable.
b. dummy variable. d. dichotomous
variable.
19. The
dollar price paid to use capital is known as:
a. the interest rate. c. the
rental price of capital.
b. the exchange rate. d. the
general price level.
20. The
price of labor is the:
a. exchange rate. c. interest
rate.
b. wage rate. d. the rental
price.
Figure1.1
Price
21. In
Figure1.1 the equilibrium price is:
a. 2 c. 7
b. 5 d. 0
22. In
Figure1.1 the equilibrium quantity is
a. 5 c. 7
b. 2 d. 8
23. In
Figure1.1 if price is 7, then
a. the market is in equilibrium. c. there
is excess quantity demanded.
b. there is excess quantity supplied. d. the
market clears.
24. In
Figure1.1 if the price is 2, then:
a. the market is in equilibrium. c. there
is excess quantity demanded.
b. there is excess quantity supplied. d. the
market clears.
25. In
Figure1.1, if price is 7, then quantity demanded is:
a. 2. c. 3.
b. 7. d. 8.
26. In
Figure1.1, if price is 7, then quantity demanded is:
a. 2. c. 3.
b. 7. d. 8.
27. In
Figure1.1, if price is 7, then quantity supplied is:
a. 2. c. 3.
b. 7. d. 8.
28. In
Figure1.1, if price is 2, then quantity demanded is:
a. 2. c. 3.
b. 7. d. 8.
29. In
Figure1.1, if price is 2, then quantity supplied is:
a. 2. c. 3.
b. 7. d. 8.
30. In
Figure1.1, if price is 5, then quantity demanded is:
a. 2. c. 3.
b. 7. d. 5.
31. In
Figure1.1, if demand falls, then equilibrium:
a. price and quantity fall. c. price
falls and quantity rises.
b. price and quantity rise. d. prices
rises and quantity falls.
32. In
Figure1.1 if supply increases, then equilibrium:
a. price and quantity fall. c. price
rises and quantity falls.
b. price and quantity rise. d. price
falls and quantity rises.
33. A
possible order of events in an economy over time is:
a. expansion, recession, peak, expansion. c. expansion,
peak, trough, recession.
b. recession, trough, expansion, peak. d. recession,
trough, peak, expansion.
34. A
trough in an economy is when the economy:
a. is growing. c. is contracting.
b. reaches a low point. d. reaches
a high point.
35. A
peak in an economy is when the economy:
a. is growing. c. is contracting.
b. reaches a low point. d. reaches
a high point.
36. A
possible order of economic fluctuations is:
a. recession, boom, expansion, trough. c. recession,
trough, expansion, peak.
b. expansion, recession, boom, trough. d. expansion,
trough, recession, peak.
37. If
prices are sticky:
a. the market quickly sticks at
equilibrium. c. the market only slowly moves toward
equilibrium.
b. the market clears quickly. d. all
of the above.
38. In
an economic model:
a. endogenous variables feed into a model
to affect exogenous variable. c. exogenous and endogenous variables feed
into the model.
b. exogenous variables feed into a model
to affect endogenous variables. d. none of the above.
39. A
price taker:
a. takes the price to the market. c. accepts
the market price and decides whether and how much to buy or sell.
b. controls the market price. d. accepts
the market quantity and sets price.
40. A
macroeconomist would study the:
a. price of cars. c. the sales of
beer.
b. the market for shoes. d. none
of the above.
41. Since
the late 1800s, U.S. GDP has followed
a. a general downward trend. c. a
flat trend.
b. a general upward trend. d. no
discernable trend.
42. An
economic expansion ends when the economy
a. reaches a peak. c. begins a
boom.
b. reaches a trough. d. begins
a surge.
43. An
economic recession ends when
a. the economy reaches a peak. c. unemployment
reaches zero percent.
b. the economy reaches a trough. d. unemployment
rises at a slow pace.
44. The
unemployment rate measures
a. the number of people applying for
unemployment insurance. c. the number of people in government
welfare programs.
b. the percentage of people working at the
minimum wage. d. the percentage of people seeking work
who do not have a job.
45. The
trend in the U.S. inflation rate since the 1970s has been
a. an increase in the rate. c. a
decrease in the rate.
b. a decrease in the rate, followed by an
increase in the rate. d. a steady trend, with no major change in
the rate.
46. The
changing rates of inflation in the U.S. mostly reflects changes in institutions
such as
a. the gold standard. c. the
U.S. tax code.
b. U.S. Federal Reserve policy. d. both
(a) and (b).
47. In
the past twenty-five years, the U.S. Federal Reserve mostly has pursued a
policy of
a. low income tax rates. c. low
and stable inflation.
b. low corporate tax rates. d. high
required reserve rates.
48. An
example of an exogenous variable in a macroeconomic model most likely would be
a. the level of employment. c. the
weather.
b. the level of real GDP. d. the
interest rate.
49. An
example of an endogenous variable in a macroeconomic model most likely would be
a. the level of employment. c. the
level of real GDP.
b. the existence of a war. d. either
(a) or (c).
50. An
example of an endogenous variable in a macroeconomic model most likely would be
a. the interest rate. c. the
development of a new technology.
b. the existence of a war. d. natural
disasters.
51. Which
is NOT an example of an exogenous variable in a macroeconomic model?
a. the interest rate. c. the
development of a new technology.
b. the existence of a war. d. natural
disasters.
52. Macroeconomics
uses microeconomic models
a. to model the level of real GDP. c. to
model the market for coffee.
b. to model the decisions of individual
households and businesses. d. in no circumstances.
53. In
a macroeconomic model, the term disequilibrium refers to
a. a discrepancy between the quantities of
labor supplied and demanded. c. a gap between the wages of unskilled
and skilled workers.
b. a discrepancy between the quantities of
coffee supplied and demanded. d. a gap between the level of real GDP in
two cities.
54. In
a macroeconomic model, the term disequilibrium refers to
a. the argument that some prices in the
goods market are sticky. c. a gap between the wages of unskilled
and skilled workers.
b. a discrepancy between the quantities of
coffee supplied and demanded. d. a gap between the unemployment rate in
two cities.
55. The
new Keynesian approach argues that
a. the economy reflects perfect competion. c. individuals
and businesses are mostly price-takers.
b. some prices are sticky and move only
slowly. d. supply and demand in the goods market
move prices quickly.
56. The
new Keynesian approach argues that
a. individuals and businesses are mostly
price-takers. c. sectors of the economy may be in disequilibrium for extended
periods.
b. most prices are flexible and move
quickly. d. supply and demand in the goods market move prices quickly.
57. The
economist John Maynard Keynes argued that labor markets
a. are perfectly competitive. c. are
usually in disequillibrium.
b. are usually at a point of
disengagement. d. reflect rapid adjusment of wages to
market conditions.
58. When
a country follows a gold standard,
a. the price of gold is mostly constant. c. the
price of gold varies quite a bit.
b. the price of silver is mostly constant. d. a
central bank cannot also exist.
59. An
exchange rate reflects
a. the sum of the values of two
currencies. c. the relative levels of labor supply in
two countries.
b. the rate at which one currency
exchanges for another currency. d. the relative levels of capital in two
countries.
60. In
a macroeconomic model with perfect competition,
a. no individual buyer can noticeably
affect the prices of goods. c. buyers can affect the prices of goods,
but sellers cannot.
b. no individual seller can noticeably
affect the prices of goods. d. both (a) and (b).
61. In
a macroeconomic model with perfect competition,
a. there are many buyers and a few
sellers. c. there are many buyers and sellers.
b. there are many sellers and a few
buyers. d. there are few buyers and sellers.
62. A
macroeconomic model which uses a microeconomic foundation will begin with
a. a microeconomic model, which is then
aggregated to form a macroeconomic model. c. a macroeconomic model, which is then
aggregated to form a microeconomic model.
b. a macroeconomic model, which is then
disaggregated to form a microeconomic model. d. a gold standard model, which is then
held exogenous to form a macroeconomic model.
63. An
equilibrium price in a microeconomic model
a. shows where the quantity demanded is
less than the quantity supplied. c. shows where disequilibrium occurs.
b. is a market-clearing price. d. shows
where the quantity demanded is greater than the quantity supplied.
64. An
equilibrium price in a microeconomic model
a. shows where the quantity demanded is
less than the quantity supplied. c. occurs when there is no pressure for
the price to rise or fall.
b. is a market-lowering price. d. shows
where the quantity demanded is greater than the quantity supplied.
65. The
number for employment refers to the number of
a. employers who have job openings. c. people
looking for jobs.
b. adults in the population. d. people
with jobs.
SHORT ANSWER
1. What
types of economic issues do macroeconomists study?
2. How
is the annual inflation rate calculated?
3. What
is the rate of growth of real GDP?
4. Describe
what happens when demand or supply increase in a market.
5. What
are exogenous and endogenous variables?
6. Why
are both flexible prices and sticky prices important to macroeconomic models?
No comments:
Post a Comment