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Macroeconomics
Test Description: Macroeconomics Review
Instructions: Answer all questions to get your test result.
1) Diffrence between Real and Nominal GDP is
A
That real GDP is always smaller than Nominal GDP
B
Measured by excluding some of the sectors
C
Change in price level from base year to current year
D
None of the above.
2) GDP is market value of all the final goods
A
Produced domestically
B
Produced by domestic factors of production
C
All of the above
D
Produced by all factors of production
3) When comparing nation's economic position with other one should see its
A
GDP
B
Currency in circulation
C
None of the above
D
Per Capita GDP
4) Verticle intercept of consumption function indicates
A
Average propensity to consume
B
None of the above
C
Consumption at zero level of income
D
Al included
5) In the consumption function c=a+by
A
none of the above
B
MPC
C
Slope of the function
D
y is intercept
6) In Keynesian Framework Income is measured along
A
Verticle axis
B
45 degree line
C
Horizontal axis
D
All are correct
7) If investment is exogenous to the Income determination model it can be shown as
A
None of the above
B
Verticle line
C
All of the above
D
Horizontal line
8) In a closed economy GDP equals
A
C+I
B
C+I+X+N
C
All of the above
D
C+I+G
9) Which of the following is a central issue in macroeconomics?
A
the deregulation of the banking industry
B
none of the above
C
inflation of prescription drug prices
D
the effect of excise taxes on consumers' buying patterns
10) Which of the following is NOT an issue in macroeconomics?
A
the determination of prices in the agricultural sector
B
the possible effect of budget deficit increases on the level of investment
C
issues relating to the balance of payment
D
the relationship between inflation and unemployment
11) In studying growth theory
A
we assume that all inputs are fully employed
B
all of the above
C
we focus on the very long run
D
we ignore recessions and booms
12) In the very long run
A
the position of the AD-curve depends on the productive capacity of the economy
B
the position of the AS-curve essentially determines the level of output
C
the position of the AS-curve depends on the degree of consumer confidence
D
the position of the AD-curve is affected by changes in efficiency improvements
13) The position of the long-run AS-curve is determined by
A
consumer confidence
B
fiscal policy
C
the full-employment level of output
D
monetary policy
14) Potential GDP is
A
always greater than actual GDP
B
equal to nominal GDP adjusted for inflation
C
the level of GDP if unemployment is zero
D
none of the above
15) Increases in the rate of inflation
A
are more pronounced in periods of recession
B
always coincide with a decrease in the unemployment rate
C
generally do not occur in periods of high growth in money supply
D
generally are inversely related to the output gap
16) What is the difference between GDP and GNP?
A
GNP includes indirect taxes but GDP does not
B
GNP does not include government transfer payments but GDP does
C
GNP does not account for depreciation (capital consumption allowances)
D
GNP includes payments to domestically owned factors of production abroad
17) Which of the following transactions has no direct effect on this year's GDP?
A
you buy a two year old car from your neighbor
B
you sell your holdings of Microsoft stocks
C
an unemployed worker gets his unemployment benefits
D
none of the above directly affects GDP
18) Assume a German tourist buys a Mexican beer in a pub in Houston. How will the U.S. GDP be affected?
A
U.S. GDP will increase, but only by the sales tax assessed on the beer
B
U.S. GDP will decrease since the beer has to be imported from Mexico
C
U.S. GDP will increase by the value added at the Houston pub
D
U.S. GDP will be unaffected, since a foreigner buys a foreign product
19) Real GDP per capita is defined as
A
the fraction of real GDP devoted to capital investment
B
real GDP divided by the population
C
nominal GDP per capita minus depreciation
D
real GDP minus capital consumption allowances
20) Depreciation is
A
the difference between private domestic saving and private domestic investment
B
the difference between GNP and GDP
C
the difference between real and nominal GDP
D
another word for capital consumption allowances
*select an answer for all questions
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