IB Macroeconomics Revision Quiz

Gross Domestic Product is the sum of the market value of the ____________

• Manufactured goods

• Normal goods and services

• Intermediate goods

• Final goods and services

If nominal GDP in 2021 exceeds the nominal GDP in 2020, but GDP per capita remains unchanged, then it can be inferred that:

• The population has risen

• The country is experiencing disinflation

• The size of the labour force has risen

• The country is experiencing inflation

If US GDP exceeds US GNP, then:

• Foreign citizens and institutions living in the US are producing more than Americans overseas

• US real GDP is also higher than US GNP

• The country has a current account deficit (exports < imports)

• The value of the US$ is likely to have fallen

Inflation can be measured by all of the following except the

• Consumer price index

• Producers price index

• Finished goods price index

• GDP deflator

In 2019, the CPI was 124.0. In 2020, it was 130.7. What was the rate of inflation over this period?

• 30.7%

• 6.7%

• 5.4%

• Unclear from the information presented

The "basket" on which the CPI is based is composed of

• All goods and services produced by domestic businesses, plus the price of imported products

• All goods and services sold in the country

• All current goods and services

• Products purchased by the typical consumer

Suppose a person's income rises from €19,000 to €31,000 while the CPI rises from 122 to 169. Your standard of living has likely

• Unclear from the above information

• Fallen

• Improved

• Stayed the same

Which of the following statements about economic recession is true?

• A recession is when economic growth slows significantly

• A recession is when economic growth slows or grinds to a halt

• A recession is when GDP falls in a nation

• A recession is when real GDP falls in a nation

Which of the following would not cause a shift in the long-run aggregate supply curve?

• An increase in available labour

• An increase in the available capital

• An increase in price expectations

• An increase in the available land for economic activity

Which of the following explains why the aggregate demand curve slopes downward?

• Individuals on lower income tend to have a higher MPC

• The opportunity cost of saving money increases

• The income and substitution effect

• The income and price effect