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WorksheetsMacro Final Prep
Total questions: 55
Worksheet time: 37mins
Name
Class
Date
1.
Who is most likely to be hurt by inflation?
a)
someone who borrowed money
b)
a retiree on a fixed income
c)
a business owner
d)
the U.S. government
2.
When inflation is high the _______________of the dollar decreases
a)
cost value
b)
purchasing power
c)
importance
d)
validity
3.
is a way to illustrate how a regular group of goods and services changes over time.
a)
Consumer Price Index
b)
Final Goods
c)
Market Basket
d)
Durable Goods
4.
Goods used to create finished products
a)
Final Goods
b)
Non-Durable Goods
c)
Intermediate Goods
d)
Durable Goods
5.
Completed goods counted in the GDP
a)
Final Goods
b)
Durable Goods
c)
Intermediate Goods
d)
Non-Durable Goods
6.
Which of the following is a stage of the business cycle?
a)
Procession
b)
Trough
c)
Slide
d)
Valley
7.
Unemployment caused by regular transition periods
a)
Frictional Unemployment
b)
Structural Unemployment
c)
Seasonal Unemployment
d)
Discouraged Workers
8.
Unemployed plus employed
a)
Unemployed
b)
Unemployment Rate
c)
Labor Force
d)
Total Population
9.
Which one is part of the labor market
a)
stay at home dad
b)
a teacher
c)
a general in the military
d)
a 14 year old mowing lawns
10.
Which of the following is not an economics indicator discussed in class?
a)
Presidential Policy
b)
Inflation
c)
Gross Domestic Product
d)
Unemployment
11.
The value of money is greater as prices inflate over the course of history.
a)
True
b)
False
12.
Unemployment caused by lack of skills or demand
a)
Structural Unemployment
b)
Frictional Unemployment
c)
Seasonal Unemployment
d)
Discouraged Workers
13.
Which of these is the BEST definition of GDP?
a)
a description of the quality of life in a nation
b)
average value of production of intermediate goods
c)
a collection of all government assets that could earn money
d)
market value of all goods and services produced in a country
14.
Which result occurs when federal government expenditures are greater than the federal government's total receipts?
a)
reduced net exports
b)
increased excise taxes
c)
a federal budget surplus
d)
a federal budget deficit
15.
The federal government uses government spending and tax rates to help control recessions and encourage economic activity. This is called
a)
fiscal policy
b)
monetary policy
c)
supply-side economics.
d)
open market operations.
16.
The process by which the Federal Reserve controls the supply, availability, and cost of money in order to keep the economy stable is
a)
fiscal policy
b)
monetary policy
c)
interest rate
d)
reserve requirement
17.
When the Federal Reserve sells government securities on the open market, what effect does this action have on the nation’s money supply and interest rates?
a)
Money Supply - Decreases / Interest Rates - Increase
b)
Money Supply - Increases / Interest Rates - Increase
c)
Money Supply - Decreases / Interest Rates - Decrease
d)
Money Supply - Increases / Interest Rates - Decrease
18.
· setting the discount and interest rates
· establishing reserve requirements for banks
· buying and selling US government securities
All of these are ways in which the Federal Reserve system can
· establishing reserve requirements for banks
· buying and selling US government securities
All of these are ways in which the Federal Reserve system can
a)
control the stock market.
b)
regulate the money supply.
c)
decrease consumer spending.
d)
challenge Presidential power.
19.
The Federal Reserve wants to increase the money supply in the United States. What is the Federal Reserve likely to do to accomplish this?
a)
reduce the discount rate
b)
sell securities on the open market
c)
increase the reserve requirement for banks
d)
require banks to hold a reserve for all types of deposits
20.
Which pairs of operations BEST fit with fiscal policy?
a)
government spending and taxation
b)
taxation and open market operations
c)
discount rate and government spending
d)
open market operations and discount rate
21.
Inflation that occurs when a country experiences very high and usually accelerating rates of inflation, rapidly eroding the real value of the local currency, and causing the population to minimize their holdings of local money.
a)
Cost-push inflation
b)
Hyperinflation
c)
Demand-pull inflation
d)
Deflation
22.
The increase in unemployment caused by the recession phase of the business cycle is called
a)
Frictional unemployment
b)
Structural unemployment
c)
Cyclical unemployment
d)
Seasonal Unemployment
23.
Which type of economists believe that the economy is self correcting and does not need government intervention?
a)
Keynesian economists (Keynes)
b)
Monetarist economists
c)
Supply-side economists
d)
Classical economists (Hayek)
24.
An economy’s maximum sustained output in the long run (long run aggregate supply) is known as its
a)
Total Output
b)
Resource Output
c)
Potential Output
d)
Market Output
25.
If the Fed wanted to increase the money supply, they would
a)
Buy bonds and securities
b)
Raise the discount rate
c)
Raise the reserve requirement
d)
Lower government spending
26.
If the FED decided to increase the money supply this is most likely because the economy has
a)
an inflationary gap
b)
extremely low interest rates
c)
high unemployment
d)
a large amount of government spending
27.
Which component of GDP does the following examples contain?
A mechanic fixes his own transmission
A mechanic fixes his own transmission
a)
Consumption
b)
Investment
c)
Government spending
d)
Not counted towards GDP
28.
Which country is NOT in the "fragile five"?
a)
Turkey
b)
Brazil
c)
India
d)
Canada
29.
What would you conclude about an economy characterized by increasing gross domestic product (GDP), low unemployment, and increasing inflation?
a)
This economy is in a slow down.
b)
The government needs to address the unemployment problem.
c)
This economy is in the expansion phase of a business cycle.
d)
The Federal Reserve should expand the money supply.
30.
Peggy, a recent college graduate, decides to look for a job instead of going to graduate school. If she is unable to find a job that suits her interests right away, what type of unemployment is she MOST likely experiencing?
a)
Structural
b)
Seasonal
c)
Frictional
d)
Cyclical
31.
The BEST example of structural unemployment in an economy is someone
a)
between jobs or entering the work force.
b)
out of work due to a change in the business cycle.
c)
out of work due to a seasonal downturn in business.
d)
whose job skills do not match the economy's needs.
32.
Monetary policies the Federal Reserve can adopt include all of the following EXCEPT
a)
raising the discount rate.
b)
buying government bonds.
c)
lowering the reserve requirement.
d)
raising personal income tax rates.
33.
High levels of GDP per capita indicate...
a)
Higher levels of happiness
b)
Higher standard of living
c)
Equal levels of wealth
d)
Self-sufficient communities
34.
Which letter represents the Contractionary (Recession) Phase?
a)
A
b)
B
c)
C
d)
D
35.
Where on the business cycle would you find the highest unemployment?
a)
A
b)
B
c)
C
d)
D
36.
What is inflation?
a)
rise in all prices
b)
rise in most prices
c)
rise in some prices
d)
rise in general prices
37.
The study of the economy as a whole and how major sectors of the economy interact.
a)
Incentives
b)
Inflation
c)
Unemployed
d)
Macroeconomics
38.
The total value of all final goods and services produced in the economy during a given year, calculated using the prices of a selected base year
a)
Real GDP
b)
Nominal GDP
c)
Real GDP per Capita
d)
GDP
39.
Real GDP divided by population size
a)
GDP
b)
Real GDP
c)
Real GDP per Capita
d)
Nominal GDP
40.
People who work part time (might be over-qualified for their job) because they cannot find full-time jobs
a)
CPI
b)
Underemployed Workers
c)
Discouraged Workers
d)
Expansionary Fiscal Policy
41.
Measures the cost of the market basket of a typical urban family
a)
Aggregate Supply
b)
GDP
c)
CPI
d)
Budget
42.
When the Government saves more than it spends
a)
Budget
b)
Budget Surplus
c)
Budget Deficit
d)
Price Level
43.
Estimate of its total spending and total revenue
a)
Budget
b)
Budget Surplus
c)
Budget Deficit
d)
CPI
44.
A budget _________ is when tax revenue exceeds government spending, and a budget _________ is when government spending exceeds tax revenue.
a)
Surplus; Deficit
b)
Deficit; Surplus
45.
A _________ occurs when a borrower fails to make payments as specified by the loan or bond contract.
a)
Default
b)
Liability
c)
Financial Risk
d)
Diversification
46.
A _________ is a nonprofit institution that invests the savings of members and provides them with income when they retire.
a)
Pension Fund
b)
Mutual Fund
c)
Savings Fund
d)
Stock Fund
47.
_________ is a medium of exchange with no intrinsic value whose ultimate value is guaranteed by a promise that it can be converted into valuable goods.
a)
Commodity-Backed Money
b)
Commodity Money
c)
Fiat Money
d)
Aggregate Money
48.
According to the Keynesian framework, which of the following will not help a country to get out of a recession, but may help that country reduce inflation?
a)
an increase in military spending
b)
a decrease in military spending
c)
increase in spending by the government on health care
d)
decrease in spending by government on health care
49.
Which of the following is a building block of neoclassical economics?
a)
the size of the economy is determined by real GDP
b)
sticky wages and prices
c)
aggregate demand model
d)
wages and prices will adjust in a flexible manner
50.
The neoclassical view holds that long-term expansion of potential GDP due to _______________________ will determine ____________________.
a)
economic growth; the size of the economy
b)
government spending; aggregate demand
c)
government spending; aggregate supply
d)
economic adjustments; cyclical unemployment
51.
If the economy was doing poorly and Congress was following Keynesian economics they should,
a)
Decrease Spending
b)
Increase Spending
c)
Keep spending the same amount
d)
None of the above
52.
Which of the following is not a goal of fiscal and monetary policy?
a)
Full employment
b)
Better education
c)
Economic Growth
d)
Price Stability
53.
This theory of Fiscal policy says you should not spend more money that you have
a)
Keynesian Economics
b)
Fiscal Conservatism
c)
Liberal Ideology
d)
Piggy Bank Theory
54.
Monetary policy is primarily controlled by...
a)
Congress.
b)
the President.
c)
the House of Representatives.
d)
the Federal Reserve System (The Fed).
55.
The federal requirement to keep a certain percentage of money at the bank is know as the ...
a)
reserve requirement (rate, ratio).
b)
discount rate.
c)
mutual fund.
d)
prime (interest ) rate.
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