AP Macroeconomics

Reserves, the money supply, and interest rates are most likely to change in which of the following ways when the Federal Reserve sells bonds?

• Increase/Increase/Increase

• Increase/Increase/Decrease

• Decrease/Increase/Decrease

• Decrease/Decrease/Increase

• Decrease/Decrease/Decrease

Which of the following actions by the Federal Reserve will result in an increase in banks' excess reserves?

• buying bonds on the open market

• selling bonds on the open market

• increasing the discount rate

• increasing the reserve requirement

• increasing the federal funds rate

Gross Domestic Product is equivalent to the sum of:

• Consumer spending, investment spending, government purchases, exports, and imports

• Consumer spending, investment spending, government purchases, and exports

• Consumer spending, investment spending, government purchases and net exports

• Consumer spending, consumption of fixed capital, government purchases and exports

Which type of unemployment would most likely increase if workers were laid off due to a large decrease in consumer spending?

• Cyclical

• Seasonal

• Frictional

• Structural

Which of the following is included in the calculation of the U.S. GDP?

• The money that consumers save when using coupons

• Online purchases of used products

• A computer produced in China by a U.S. owned company

• A plane produced in the U.S but sold in Mexico

The official unemployment rate is not always the most accurate indicator of actual unemployment in the economy because

• Part time workers are considered unemployed

• The official rate does not include persons who have given up looking for work

• Full employment is greater than the labor force

• The unemployment rate is greater than natural unemployment

Which of the following is included in the calculation of the US GDP

• The money that consumers save when using coupons

• the benefit society receives from a cleaner environment

• online purchases of used products

• a computer produced in CHina by a US owned company

• a plane produced in the US but sold in Mexico

Which of the following is a tool of monetary policy used by the Federal Reserve to influence the economy?

• A) Taxation

• B) Government Spending

• C) Open Market Operations

• D) Public Education

What is the primary goal of expansionary fiscal policy?

• A) To reduce inflation

• B) To decrease government debt

• C) To stimulate economic growth

• D) To increase interest rates

In the circular flow model, households provide which of the following to firms?

• A) Goods and services

• B) Taxes

• C) Factors of production

• D) Government regulations