Macroeconomics Revision Quiz

The​ ​Consumer​ ​Price​ ​Index​ ​(CPI)​ ​can​ ​be​ ​defined​ ​as

• The​ ​market​ ​value​ ​of​ ​all​ ​final​ ​goods​ ​and​ ​services

• A​ ​measure​ ​of​ ​inflation​ ​based​ ​on​ ​the​ ​cost​ ​of​ ​a​ ​fixed​ ​“market​ ​basket”

All​ ​of​ ​these​ ​are​ ​functions​ ​of​ ​money​ ​​EXCEPT

• Medium of exchange

• Store of value

• Commodity money

• unit of measurement

Money loses its value when it

• It becomes too plentiful
• becomes too portabale
• is divisible
• is durable

Inflation is measured by...

• Consumer Price Index (CPI).
• Gross National Product (GNP).
• Gross Domestic Product (GDP).
• Securities & Exchange Commission (SEC).

A pair of shoes that costs $80 last month costs $100 this month. Which of the following BEST describes this economic condition?

• inflation

• recession

The percentage of a deposit that a bank must hold on to is called the ______.

• Reserve Requirement

• Credit

Jack saves his money in a piggy bank. He is using money as a

• medium of exchange

• store of value

• unit of measurement

• bartering tool

When a bank makes a loan of $1,000, then

• the money supply increases by $1,000

• the money supply decreases by $1,000

• nothing

• the bank owes the FED $1,000

If people are made unemployed because of a fall in aggregate demand this is known as:

• Cyclical unemployment

• Frictional unemployment

An increase in costs will

• Shift aggregate demand

• Shift aggregate supply