Question 1

Which of the following is not a concern of macroeconomics?
A) economy-wide employment and unemployment
B) the aggregate price level
C) product pricing
D) economy-wide levels of production

Accepted Answer

Macroeconomics focuses on broad economic factors affecting an entire country or the global economy, such as total national output (GDP), unemployment rates, and inflation. Product pricing, however, is typically a concern of microeconomics, which deals with the behavior of individuals and firms in making decisions on the allocation of limited resources.

Question 2

Which of the following is not a reason to study macroeconomics?
A) to gain cultural literacy
B) to understand how macroeconomic trends affect you personally
C) to exercise your responsibility as a citizen
D) to learn how to become wealthy

Accepted Answer

Macroeconomics focuses on the performance, structure, behavior, and decision-making of an economy as a whole, rather than individual markets. This includes national, regional, and global economies. While it can help individuals understand economic trends and make informed decisions, it does not specifically teach how to become wealthy, which is more aligned with personal finance and investment strategies.

Question 3

Which of the following is not one of the six key variables in macroeconomics?
A) the unemployment rate
B) the price of wheat
C) the inflation rate
D) the level of the stock market.

Accepted Answer

The price of wheat is not one of the six key variables in macroeconomics. The six key variables are:1. Gross domestic product (GDP)2. Unemployment rate3. Inflation rate4. Interest rates5. Exchange rates6. Stock market

Question 4

Which of the following is not one of the six key variables in macroeconomics?
A) the unemployment rate
B) the exchange rate
C) the price of Microsoft stock
D) the level of the stock market.

Accepted Answer

The price of Microsoft stock is not considered a key variable in macroeconomics because it is specific to a single company rather than reflecting the broader economy. Macroeconomics focuses on aggregate indicators and phenomena affecting the economy as a whole, such as unemployment rates, exchange rates, and overall stock market levels, rather than the performance of individual stocks.

Question 5

Which of the following is not one of the six key variables in macroeconomics?
A) the interest rate
B) the unemployment rate
C) the inflation rate
D) the level of the production in the steel industry

Accepted Answer

The level of production in the steel industry is not one of the six key variables in macroeconomics. Macroeconomics focuses on broad economic factors affecting an entire economy, not specific industries.

Question 6

Which of the following is not one of the six key variables in macroeconomics?
A) the level of employment in the automobile industry
B) the interest rate
C) the inflation rate
D) the level of the stock market.

Accepted Answer

The level of employment in the automobile industry is a microeconomic variable, while the other options are macroeconomic variables.

Question 7

Which of the following is not one of the six key variables in macroeconomics?
A) the exchange rate
B) the cost of a college education
C) the inflation rate
D) the unemployment rate.

Accepted Answer

The cost of a college education is not considered one of the six key variables in macroeconomics, which typically include broad measures such as the exchange rate, inflation rate, and unemployment rate, focusing on the economy as a whole rather than specific costs of services or goods.

Question 8

The nominal exchange rate is
A) the rate which banks charge the least risky businesses.
B) the rate which District Federal Reserve Banks charge member banks.
C) the rate at which the goods and services purchased in different countries can be exchanged one for another.
D) the rate at which the monies of different countries can be exchanged one for another.

Accepted Answer

The nominal exchange rate is the rate at which the currencies of different countries can be exchanged for one another. It is a measure of how much of one currency can be exchanged for a unit of another currency.

Question 9

The real exchange rate is
A) the rate which banks charge the least risky businesses.
B) the rate which District Federal Reserve Banks charge member banks.
C) the rate at which the goods and services purchased in different countries can be exchanged one for another.
D) the rate at which the monies of different countries can be exchanged one for another.

Accepted Answer

The real exchange rate is the rate at which goods and services of one country can be exchanged for those of another. It adjusts the nominal exchange rate by the price levels of the two countries, providing a more accurate measure of the exchange of real value between them.

Question 10

In 2000 prices, real GDP per worker has reached a level of approximately
A) $65,000 in the year 2000.
B) $73,000 in the year 2000.
C) $50,000 in the year 2000.
D) $80,000 in the year 2000.

Accepted Answer

Real GDP per worker in 2000 prices was approximately $73,000 in the year 2000.

Question 11

Real GDP is a measure of the economy's
A) unemployment level.
B) output level.
C) stock market level.
D) inflation rate.

Accepted Answer

Real GDP measures the value of all goods and services produced by an economy in a given period, adjusted for inflation, thus reflecting the economy's output level.

Question 12

The two major macroeconomic policy of the government are
A) tax and spending policies.
B) growth policy and monetary policy.
C) growth policy and stabilization policy.
D) monetary policy and stabilization policy.

Accepted Answer

The two major macroeconomic policies of the government are growth policy, which focuses on long-term economic growth, and stabilization policy, which aims to reduce economic fluctuations and maintain economic stability.

Question 13

If a domestic currency has appreciated
A) foreign-made goods are cheap relative to domestic-made goods.
B) domestic-made goods are cheap relative to foreign-made goods.
C) exports are likely to increase.
D) imports are likely to decrease.

Accepted Answer

When a domestic currency appreciates, it gains value against foreign currencies. This makes foreign-made goods cheaper in terms of the domestic currency, as fewer units of the domestic currency are needed to buy the same amount of foreign currency and, consequently, foreign goods.

Question 14

If a domestic currency has depreciated
A) foreign-made goods are cheap relative to domestic-made goods.
B) domestic-made goods are cheap relative to foreign-made goods.
C) exports are likely to decrease.
D) imports are likely to increase.

Accepted Answer

When a domestic currency depreciates, the value of the currency decreases relative to foreign currencies. This makes domestic-made goods cheaper for foreign buyers, potentially increasing exports, while making foreign-made goods more expensive for domestic consumers, potentially decreasing imports.

Question 15

Real GDP per worker approximately _________ since 1890.
A) doubled
B) tripled
C) sextupled
D) quintupled

Accepted Answer

Real GDP per worker has approximately sextupled since 1890, reflecting significant growth in productivity and economic output per worker over this period.

Question 16

Fluctuations in production and employment are commonly referred to as
A) palpitations.
B) booms.
C) unemployment.
D) business cycles.

Accepted Answer

Business cycles refer to the fluctuations in economic activity that an economy experiences over a period, including periods of expansion (booms) and contraction (recessions), affecting production and employment levels.

Question 17

Periods in which production falls and unemployment rises are called
A) macroeconomic expansions.
B) business cycles.
C) recessions, or possibly, depressions.
D) inflation.

Accepted Answer

Periods in which production falls and unemployment rises are typically referred to as recessions. If these periods are particularly severe or prolonged, they may be termed depressions.

Question 18

Microeconomists
A) focus on the markets for individual commodities and on the decisions of single economic agents.
B) spend much time analyzing how total income changes, and how changes in income cause changes in other modes of economic behavior.
C) spend a great deal of time and energy investigating how people form their expectations and change them over time.
D) consider the possibility that decision makers might change the quantities they produce before they change the prices they charge.

Accepted Answer

Microeconomists concentrate on the behavior of individual markets and the decisions made by single entities, such as consumers or firms, rather than on the economy as a whole or on aggregate economic variables.

Question 19

Microeconomists
A) focus on the economy as a whole.
B) hold total income constant.
C) spend a great deal of time and energy investigating how people form their expectations and change them over time.
D) consider the possibility that decision makers might change the quantities they produce before they change the prices they charge.

Accepted Answer

Microeconomists hold total income constant when analyzing the behavior of individual markets.

Question 20

Microeconomists
A) focus on the economy as a whole.
B) spend much time analyzing how total income changes, and how changes in income cause changes in other modes of economic behavior.
C) don't worry much about how decision makers form their expectations.
D) consider the possibility that decision makers might change the quantities they produce before they change the prices they charge.

Accepted Answer

The answer of Microeconomists
A) focus on the economy as a...

Quiz 1: Introduction to Macroeconomics

Which of the following is not a concern of macroeconomics?

Which of the following is not a reason to study macroeconomics?

Which of the following is not one of the six key variables in macroeconomics?

Which of the following is not one of the six key variables in macroeconomics?

Which of the following is not one of the six key variables in macroeconomics?

Which of the following is not one of the six key variables in macroeconomics?

Which of the following is not one of the six key variables in macroeconomics?

The nominal exchange rate is

The real exchange rate is

In 2000 prices, real GDP per worker has reached a level of approximately

Real GDP is a measure of the economy's

The two major macroeconomic policy of the government are

If a domestic currency has appreciated

If a domestic currency has depreciated

Real GDP per worker approximately _________ since 1890.

Fluctuations in production and employment are commonly referred to as

Periods in which production falls and unemployment rises are called

Microeconomists

Microeconomists

Microeconomists