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Macro: Final Exam
Macro: Final Exam
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Principles of Macro Review for Final Exam
Flashcards
46 cards
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Practice quiz
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Questions
46
Answers
1
Which of these is the primary determinant of consumer spending?
Wealth
Borrowing
Real Interest Rates
Income
2
Which type of business tends to be larger and pays corporate income tax?
C Corporations
S Corporations
Pass-through Corporations
3
Which of these measures of unemployment accounts for underemployment?
U5
U3
U6
4
Costs of production for Y go up, what likely happens to price of Y in a noncompetitive market?
Decreases
Increases
5
What measurement do we use that best captures economic growth?
Real GDP per capita
GNP
Real GDP
Nominal GDP
6
Which of these is NOT a definition of inflation?
Increase in price level
Goods and services become more expensive
Decrease in value of dollar relative to goods
Increase in money supply
7
North Korea is probably best labelled what economic system?
Democratic Socialism
Autocratic Communism
Capitalism
Fascism
8
Which type of business hired the majority of all employees in the US?
Small businesses
Large businesses
9
GDP or Not GDP: Your dad sells you his old guitar for $100.
Not GDP
GDP
10
Type of unemployment: Lost job in mass layoffs across the economy.
Structural
Frictional
Cyclical
11
Which banks was allowed to fail in the 2008 crisis because of the bad CDOs they owned?
AIG
Lehman Brothers
Goldman Sachs
Bear Stearns
12
GDP or Not GDP: Toyota produces Corollas in Texas and sells them in Mexico.
GDP
Not GDP
13
Which of the following is a 'short' against an asset?
CDO
CDX
TARP
MBS
14
Which of these types of spending is marked by smoothing adding to its stability?
Consumer spending
Investment spending
Government spending
15
What constrains the money supply?
Reserve requirement
Monetary base
The Fed
Banks' lending decisions
16
What has happened to fertility rate in the US over the last few decades?
Dropped below replacement level
Increased above replacement level
Leveled off
17
Which of these is NOT a sub category of consumer spending?
Nondurable goods
Services
Durable goods
Construction
18
Which of these is NOT a reason why demand curves slope downward?
Diminishing returns
Substitution effect
Scarcity effect
Income effect
19
Which of these is NOT a reason why spending or demand drives the macro economy?
For-profit system
Innovation creates demand
On demand output
Excess capacity
20
What has happened to the poverty rate in the US over the last few decades?
Increased
Stayed about the same
Decreased
21
Which of the following is expansionary fiscal policy?
Lower interest rates
Increasing gov't deficit
Increasing gov't surplus
Higher interest rates
22
What economic system dominated Europe from the Dark Ages to the Industrial Age?
Capitalism
Feudalism
Communism
Socialism
23
Which of these counts in the labor force?
Retiree
Unemployed
Stay at home parent
Children under 16
24
Which of these has been the most common cause of a recession in the US?
Drop in population
Financial crisis
Declining innovation
War
25
Which of these problems does the US tend to encounter more often?
Not enough spending
Not enough productive capacity
26
Which expenditure component of GDP is often negative in the US?
Net Exports
Government spending
Investment spending
Consumer spending
27
GDP or Not GDP: You grow and sell vegetables to your neighbors out of your backyard.
GDP
Not GDP
28
Which of the following is expansionary monetary policy?
Increasing gov't deficit
Higher interest rates
Increasing gov't surplus
Lower interest rates
29
Which of these cause net exports to increase?
Depreciation of the currency
Appreciation of the currency
30
If demand increases for X, what would likely happen to price of X?
Decreases
Increases
31
What is the negative multiplier effect called?
Inconsistency of abstemiousness
Paradox of thrift
Contradiction of hoarding
Incongruity of frugality
32
Which of the following are NOT one of the two goals of the Fed?
Full employment
High economic growth
Price Stability
33
Which of these is NOT a reason why most supply curves are horizontal?
More profit can be made at higher prices
Costs of production are not increasing
Markets aren't perfectly competitive
Businesses have pricing power
34
The US gov't is in danger of going bankrupt. True or False?
True
False
35
Which of these is better for the macro economy?
Saving
Spending
36
What has happened to household size in the US over the last few decades?
Increased
Decreased
37
Which of these would increase investment spending?
Low capacity utilization rates
Increase in operating costs
Unexpected decrease in inventories
Increase in real interest rates
38
GDP or Not GDP: You purchase stock in a startup company.
GDP
Not GDP
39
What has happened to wealth and income inequality in the US over the last few decades?
Increased
Stayed about the same
Decreased
40
What is the meaning of the root word for economics?
Art of maximizing utility under scarcity
Art of maintaining the household
Art of surviving and thriving
Art of money making
41
Which of these is an example of predistribution?
Food stamps
Transfers to the poor
Mandated schooling
Taxing the rich
42
Which of the following is true?
Banks create new money when they lend to customers
Banks lend out reserves to customers
The Fed controls the money supply
Banks lends out your deposits to other borrowers
43
What is the concern of the gov't running too large of a deficit?
Inflation
Reduced savings
Bankruptcy
Higher interest payments
44
Who has the higher MPC?
Poorer person
Wealthier person
45
If price of Z, a substitute of X goes up, what happens in the market for X?
Demand for X increases
Demand for X decreases
46
Which of these was NOT a feature of early Capitalism?
Large, well-off middle class
Long hours and low pay for working class
Wild swings in economic activity
Huge economic growth
