WorksheetsUnit 3 Macro Exam Review
Total questions: 31
Worksheet time: 16mins
Gross Domestic Product (GDP) refers to…
the total amount of a specific good or service that is available to consumers
the dollar value of all final goods and services produced within a country’s borders in one year
a state where economic forces such as supply and demand are balanced
any structure that allows buyers & sellers to exchange goods & services
Which of the following is considered a part of GDP?
Consumer Spending
Transfer Payments
Stocks and bonds
Used products
Which of the following would be considered investment spending (I)?
Government buys the Army new tanks
Chinese goods sold in the United States
Two movies tickets for a night out with a friend
A new factory built in the United States
Which of the following is included in GDP?
The purchase of stocks on the NYSE
An illegal sale of scalped tickets
College students buy brand new textbooks
A stay-at-home parent cleans their home
Which of the following is included in GDP?
Bobby pays $300,000 for a house built 15 years ago
Vivian, an accountant, completes her own tax forms
Carli pays $500 a month for rent
Shiontae receives Social Security, a transfer payment from the government
In the simplest circular-flow model, households supply __________ and demand ___________.
capital; barter
wages and income; capital markets
labor; goods and services
firms; markets
Unemployment refers to...
Workers that are actively looking for work, but are not currently working
Workers that at least 12 years old who are not working
Workers that are not working, including those who stopped looking
Workers that are working part-time
Which of the following are considered unemployed?
Your retired grandparent
A college student who applied for a first job
A single parent looking for a second job
A prisoner serving a 20 year sentence
Which of the following individuals is considered unemployed?
A lawyer that sold his firm and is now looking for a job as a teacher
An electrician that is working part-time and is looking for a full-time job.
A retired school teacher
An auto worker who has given up looking for a job
Which of the following is the best example of structural unemployment?
New immigrants have a hard time finding jobs
Workers are laid off due to a recession
Workers are fired because they do not have the specific skills employers value
Workers enter the labor force because wages are increasing
Which type of unemployment would most likely increase if workers are laid off due to a recession?
Cyclical
Structural
Frictional
Seasonal
Inflation can best be defined as...
The rising general level of prices and reduced purchasing power.
The decrease in general prices.
A state where economic forces such as supply and demand are balanced.
Alternating periods of expansion and recession in the economy.
Which of the following groups would most likely gain from unanticipated inflation?
Borrowers of loans at fixed interest rates.
Lenders of loans at fixed interest rates.
Individuals who save money under their mattress.
Retirees with fixed incomes like Social Security.
The term “business cycle” most closely refers to the
Alternating periods of expansion and recession.
Fluctuating profits of firms
Accounting period used by firms
Fiscal year
Trough
A
B
C
D
Expansion/Recovery
A
B
C
D
Contraction/Recession
A
B
C
D
Peak
A
B
C
D
In the business cycle, a recession refers to...
A situation where economic forces such as supply and demand are balanced.
A 6-month period of decline in real GDP.
A condition in which virtually all who are willing and able to work are employed.
A period of time where real GDP grows for two or more consecutive quarters.
During a contractionary phase (or recession) of the business cycle, the unemployment rate and inflation rate will change in which of the following ways?
Increase; Increase
Increase; Decrease
Decrease; Decrease
Decrease; Increase
Fiscal policy refers to...
Fluctuating profits of businesses
Actions taken by Congress to stabilize the economy
The dollar value of all final goods and services produced within a country's borders in one year.
A state where economic forces such as supply and demand are balanced.
Which of the following is responsible for fiscal policy?
The President
Congress
Federal Reserve Bank
U.S. Treasury
Which of the following is an example of fiscal policy?
Decreasing income tax rates
Increasing the interest rates
Lowering tariffs on imported goods
Printing and distributing more currency
An appropriate fiscal policy to combat a recession would be to increase which of the following?
Interest rates
Tariffs
Taxes
Government spending
Monetary policy refers to...
The dollar value of all final goods and services produced within a country's borders in one year.
Actions taken by the Federal Reserve Bank to stabilize the economy.
A state where economic forces such as supply and demand are balanced.
Alternating periods of expansion and recession in the economy.
Which of the following is responsible for monetary policy?
The President
Congress
Federal Reserve Bank
U.S. Treasury
What monetary policy can be implemented to stimulate the economy?
decrease interest rates
increase income taxes
decrease government spending
increase interest rates
Which of the following indicators is best to use to determine standard of living?
Gross savings as percent of GDP
Annual population growth
GDP
GDP per capita
Which of the following factors contributes to economic growth?
Restricted international trade
Politicial instability
Limited economic freedom
Technological innovation
Which of the following government policies should the government take to promote economic growth?
Decrease interest rates to increase investment in new technologies and capital.
Increase business taxes to slow spending on new tools, machinery, and equipment.
Increase interest rates to decrease investment in new technologies and capital.
Increase government spending on defense such as new military equipment.
Which of the following would most likely occur when a country experiences long-term economic growth?
Increased crime rates
Increased life expectancy
Decreased production of goods
Decreased economic freedom
