Macroeconomics Quiz

What is the definition of macroeconomics?

• The study of individual firms and industries

• The study of economic behavior of individuals and firms

• The study of the financial performance of a single organization

• The study of the behavior and performance of an economy as a whole

• The study of how economic policy affects global economic conditions

Scarcity is a problem because:

• There is not enough money in the economy

• The government does not have enough resources

• There is not enough of a certain good or service to meet demand

• People do not have enough time

• There is too much of a certain good or service

The total market value of all final goods and services produced in an economy in a given period of time is referred to as

• National Product

• Gross Domestic Product

• Nominal Domestic Production

• Gross Rate of Production

• Net Domestic Product

Which of the following is true regarding Gross Domestic Product (GDP)?

• Intermediate goods are not counted because GDP does not include imports from foreign countries

• Household production, like home auto repair, is counted in GDP

• Transfer payments are not included in GDP because government expenditures are not counted

• GDP includes the purchase and sale of all goods and services in a country in one year

• GDP, adjusted for inflation, measures economic growth over time

Which of the following is NOT a factor of production?

• Labor

• Capital

• Land

• Consumption

• Entrepreneurship

What is the production possibility frontier used to illustrate?

• The maximum amount of production that can be achieved

• The maximum amount of production that can be achieved at the lowest cost

• The maximum amount of production that can be achieved in the most efficient way

• The maximum amount of production that can be achieved in a given time period

• The maximum amount of production that can be achieved for given resources

What is the opportunity cost of producing more of one good than another?

• The price of one good in terms of the other

• The cost of production for the other good

• The amount of production that must be sacrificed for the other good

• The value of both goods in terms of money

• The total cost of production for both goods

What is the Consumer Price Index (CPI)?

• A measure of money supply in an economy

• A measure of average prices of goods and services in an economy

• A measure of average wages in an economy

• A measure of the cost of living in an economy

• A measure of stock market performance

If the cost of the basket of goods and services the Bureau of Labor Statistics uses to calculate the consumer price index rises from $200 in the base period to $400 in the current period, then the consumer price index

• Equals 0.5 in the current period

• Has risen 5 percent from the base to the current period

• Equals 50 in the current period

• Equals 200 in the current period

• Has risen 200 percent

The relationship between the price level and the quantity of aggregate output produced is known as

• The aggregate supply curve

• The aggregate demand curve

• The Phillips Curve

• The Law of Supply and Demand

• The Money Market