Macro Chapter 4

What does the term "average labor productivity" refer to in macroeconomics?

• The total number of workers in an economy

• The amount of output produced per worker

• The average wage paid to workers

• The total hours worked by all employees

Which of the following best describes monetary policy?

• Government decisions about spending and taxation

• Central bank actions that influence the money supply and interest rates

• Laws that regulate business competition

• Policies that set minimum wage levels

Fiscal policy primarily involves which of the following?

• Adjusting the money supply to control inflation

• Setting interest rates to influence borrowing

• Government decisions about spending and taxation

• Regulating the stock market

What is the main focus of structural policy in macroeconomics?

• Managing the overall level of demand in the economy

• Changing the underlying institutions and frameworks of the economy

• Controlling the supply of money

• Setting short-term interest rates

Which of the following is an example of positive analysis?

• Arguing that the government should increase taxes

• Describing the effects of a tax increase on unemployment

• Suggesting that inflation is unfair to savers

• Recommending a new minimum wage law

Normative analysis in economics is best described as:

• Explaining how markets function in reality

• Making value judgments about what the economy should be like

• Measuring the unemployment rate

• Calculating the inflation rate

Aggregation in macroeconomics refers to:

• The process of combining individual economic variables into a total

• The calculation of individual prices in a market

• The separation of microeconomic and macroeconomic data

• The measurement of only government spending

Which of the following best measures living standards in a country?

• The total number of businesses

• The average output or income per person

• The number of government employees

• The total exports of a country

Unemployment is defined as:

• The number of people not working, regardless of their job search status

• The percentage of the labor force without a job but actively seeking work

• The total number of people in the country

• The number of people working part-time

Inflation is best described as:

• A decrease in the general price level of goods and services

• An increase in the general price level of goods and services

• A rise in unemployment rates

• A reduction in government spending