Macroeconomics MCQ Questions Answers

1. The amount of capital equipment used up or destroyed is called the ____________.

2. Expansionary monetary policy refers to the ________ to increase real gdp.

3. Due to ________, government outlays have risen quickly since 2000.

4. During cost-push inflation, aggregate output _______ and the aggregate price level _________.

5. Flat taxation is present when a set rate is applied to _______ levels of income.

6. As long as people have different _____, everyone has a comparative advantage in something.

7. Economic investment refers to _____.

8. Economic _________has affected bread-winning and consumption in american families.

9. Empiricism is a principle in economics that _________.

10. M2 is _____ in dollar value than m1; it also contains _____ assets.

11. U.s. imports are _____ produced in _____ and sold in _____.

12. To say that economists use the scientific method means that they are using ___________.

13. The _______, the greater is the amount that a household decides to save.

14. In 1960 federal spending accounted for about ______ percent of the total economy.

15. Government salaries paid to soldiers in the military are included in the ________ category of gdp.

16. Between 1929 and 1933, government spending _____ and net exports _____.

17. An economy grows when it does all of the following except _______.

18. _________ refers to the technology gap that exists between different social and economic classes.

19. A shopper at a convenience store is ________ sensitive, but price insensitive.

20. The two broad sources of potential gdp growth are growth of ______ and growth of ______.

21. It can be said that ____ laid the foundation for the industrial revolution.

22. Increases in t will reduce the economys gdp by causing a(n) ________ in the ad.

23. The difference between the ________ for a good and the ________ is called consumer surplus.

24. In texas, people who fall within the top 1 percent of average income pay ____ percent in taxes.

25. In order to take out the effect of _____________, an adjustment must be made for price changes.

26. By about 2050, the ___________ populations in _____________ are expected to boom.

27. Stagflation occurs when prices ______ and output ______.

28. The quantity of money in an economy and the _____________________ are inextricably intertwined.

29. Inflation is best understood as the rate at which __________.

30. A population that is growing logistically _____.

31. The nyse hybrid market allows _____.

32. Budget deficits automatically __________ during recessions and __________ during expansions.

33. ________ exposure deals with cash flows that result from existing contractual obligations.

34. In the _____, firms change the underlying technology while holding cumulative output constant.

35. A stagflation can turn into a cost-push inflation process when _______.

36. The broadest measure to adjust nominal gdp for price changes is _____.

37. Hubble's law was discovered using measurements of two properties of a galaxy: _______ and _______.

38. A government budget deficit ______ the real interest rate because ______.

39. The compounding effect ________ savers and _________ borrowers.

40. Money market securities are sometimes referred to as cash equivalents because _____.

41. The open market operations of the fomc are the _______________ tool of the fed.

42. The immediate change is ______ in m1 of $1,000 and ______ in m2.

43. Presently, gdp is ________ to compensate for the costs of environmental damage.

44. In rbc theory, the lower the real interest rate, other things remaining the same, the ______ today.

45. Durable goods and non-durable goods comprise approximately ________ of the supply side of the gdp.

46. Consumption depends positively on ______ and investment depends negatively on ______.

47. An increase in current income taxes ______ the supply of loanable funds today because it ______.

48. Aggregate demand is more likely to _________________ than aggregate supply in the short run.

49. A rise in the money wage rate with no change in potential gdp creates ______.

50. The most significant difference between a partnership and a sole proprietor is the ________.

51. A recession tends to make a _____________________.

52. One reason the ad curve is downward sloping is the __________ effect.

53. A nation's prosperity is sometimes measured in terms of ___________.

54. A stagflation can turn into a cost-push inflation process when _______.

55. If the fed buys government securities from commercial banks in the open market _____.

56. The money demand curve relates ______ to the ________.

57. The m2 money multiplier is ___________ the m1 multiplier.

58. Reserves in the banking system ______. banks ______ loans.

59. It is the __________________ that gives fiat money it value.

60. Excess reserves are a bank's _____ reserves minus its _____ reserves.

61. Except for one point, the short run average cost must always be ________ the long run average cost.

62. Examples of physical capital are ______. examples of financial capital are ______.

63. Depository institutions provide four benefits, which are ______.

64. According to the laffer curve, _____.

65. A depository institution takes deposits from ______ and earns most of its income by _______.

66. When one commercial bank borrows from another commercial bank, it pays the __________ rate.

67. The limited resources in demand in society are called the ___________ of production.

68. New investment is usually put into an economy when profit expectations are __________.

69. In economics, the factor of production "land" includes all of the following except ________.

70. In a developing economy, __________.

71. In a competitive market equilibrium the ________ equals the ________ of the last unit sold.

72. Variables expressed in terms of money are called ______ variables.

73. Total output refers to the goods and services made by _____ producers in a country.

74. Changes in _____ cannot shift the aggregate demand curve.

75. A period of stagflation can be the result of ________

76. If the fed wants to raise the federal funds rate, it will ______ bonds, which ________ bond prices.

77. Money is __________ when a bank makes a loan to a customer.

78. Part of the _____ is an economic downturn, which causes _____.

79. Saving is _____

80. Money that has no value other than as money is called ______ money.

81. Covered interest arbitrage moves the market ________ equilibrium because ________.

82. If the economy is in a recessionary gap, actual output will be _____ potential output.

83. Everything else held constant, a decrease in net taxes ________ aggregate ________.

84. During a business cycle expansion, total production ________ and total employment ________.

85. The _____in an economy whose aggregate real output is growing faster than the total population.

86. A recessionary gap exists if (actual) real gdp is __________ natural real gdp.

87. A downward-moving gdp indicates that ________.

88. ________ a nation's production possibilities frontier represents economic growth.

89. The discount rate is kept ________ the federal funds rate because the fed prefers that

90. On average, since 1900 u.s. output has grown by roughly ____ percent per year.

91. Structural unemployment usually lasts ________ period of time ________ unemployment

92. The ____________________ in an ad/as diagram is most relevant to say?s law.

93. In general, banks make profits by selling ________ liabilities and buying ________ assets.

94. The federal reserve generally uses ___________________ to implement monetary policy.

95. Gdp equals aggregate income and also equals aggregate expenditure because _______.

96. With _____________ demand the price changes, but the amount purchased remains the same.

97. When firms agree to act as a monopoly and set prices they are called __________.

98. When the fed buys bonds, its demand _____ the price of bonds, _____ nominal interest rates.

99. When the demand of a product increases ______

100. Refer to the table. exports might be ____ and imports ____.