Macroeconomics Essay

4972 words - 20 pages

Exam Assignment 2
______________________


MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

1)

An increase in the overall price level is known as

1)

___A____

A)

inflation.

B)

recession.

C)

deflation.

D)

stagflation.



2)

Aggregate behavior is

2)

____A___

A)

the behavior of all households and firms together.

B)

the behavior of each individual.

C)

the behavior of each household and firm.

D)

none of the above.



3)

Deflation occurs when

3)

____D___

A)

economic activity declines. ...view middle of the document...

B)

a recession.

C)

a peak

D)

an inflation.



9)

It has become conventional to classify an economic downturn as a recession when aggregate output declines for

9)

____D___

A)

three consecutive quarters.

B)

six consecutive quarters.

C)

a year.

D)

two consecutive quarters.



10)

If the labor force is 500 and employment is 450, then the unemployment rate is

10)

___C___

A)

100%.

B)

90%.

C)

10%.

D)

0%.



11)

A prolonged and deep recession is called

11)

___A___

A)

a depression.

B)

hyperinflation.

C)

a business cycle.

D)

a stagflation.



12)

Unemployment means that

12)

___D___

A)

there are some people who will not work at the going wage rate.

B)

people are not willing to work at the going wage rate.

C)

there is excess demand in the labor market.

D)

at the going wage rate, there are people who want to work but cannot find work.



13)

Unemployment implies that in the labor market

13)

___C___

A)

there are too few workers for the jobs available.

B)

there is an excess demand for labor.

C)

there is an excess supply of labor.

D)

quantity demanded of labor exceeds quantity supplied.



14)

The unemployment rate equals

14)

___A___

A)

(labor force - employed)/labor force.

B)

labor force/population.

C)

(employed - unemployed)/labor force.

D)

unemployed/employed.



15)

If the labor force is 50 million and 48 million are employed then the unemployment rate is:

15)

__B____

A)

2%.

B)

4%.

C)

5%.

D)

52%.



16)

If the central bank decreases the money supply, it is conducting

16)

___A___

A)

monetary policy.

B)

supply-side policy.

C)

incomes policy.

D)

fiscal policy.



17)

Government policies regarding taxes and expenditures are called

17)

___D___

A)

supply-side policy.

B)

income policies.

C)

monetary policy.

D)

fiscal policy.



18)

The government wants to encourage consumer spending through cutting income taxes. This is an example of

18)

___A___

A)

a fiscal policy.

B)

an incomes policy.

C)

a supply-side policy.

D)

a monetary policy.



19)

The ________ can change the quantity of money in the economy.

19)

___A___

A)

Federal Reserve

B)

Treasury Department

C)

Office of the Comptroller of the Currency

D)

Congress



20)

Policies designed to affect the quantity of money are

20)

___A___

A)

monetary policies.

B)

...

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