Macro ALL weeks (9-14)

Multiple Choice Questions: Use of National Income + Aggregate Demand and Supply + Unemployment + Money + Exchange Rates

Question 1:The lower turning point of a business cycle is called a:
recession
trough
contraction phase
stagflation
Question 2:GDP (Y) of an economy with housefold, business or government and foreign sectors is equal to:
Y = C + I + G + M (import)
Y = C + I + G + X + M
Y = C + S
Y = C + I + G + X (net export)
Question 3:A fall in the price level leads to:
decrease in real GDP demanded along an unchanged AD curve
bodily shift to the right of the AD curve
an increase in real GDP demanded along an unchanged AD curve
bodily shift to the left of the AD curve
Question 4:Downward slope of AD curve is due to the operation of:
all of the above
intertemporal substitution effect
real money balance effect (wealth effect)
international substitution effect
Question 5:Ceteris paribus, if the reserve bank raises interest rates, this will lead to:
decrease in real GDP demanded along an unchanged AD curve
an increase in real GDP demanded along an unchanged AD curve
a rightward shift of the AD curve
a leftward shift of the AD curve
Question 6:Economic theories can only be applied in the following ranges of SAS curve:
intermediate range
horizontal range
vertical range
all the above
Question 7:The LAS curve is vertical at that level of RGDP where:
the SAS curve intersects the AD curve
economy is operating at it's physical limit
each firm is producing its profit -maximising output
the economy achieves full employment
Question 8:Macroeconomic equilibrium occurs:
at the point of intersection of the LAS and AD curves
at the point of intersection of the LAS and SAS curves
none of the above
at the point of intersection of the SAS and AD curves
Question 9:If the equilibrium RGDP is less than it's long run level:
there is a recessionary gap
the economy is not in macroeconomic equilibrium
the economy is in an unemployment equilibrium
both (A) and (C) are correct
Question 10:An increase in wage rates will shift:
the LAS curve to the left but leave SAS curve unchanged
both the SAS and LAS curves to the left
both the SAS and LAS curves to the right
the SAS curve to the left but leave LAS curve unchanged
Question 11:The natural rate of unemployment for Australia is about:
0 per cent
5 per cent
4 per cent
6.2 per cent
Question 12:Unemployment that occurs when workers either change jobs or enter the labour force is called:
Structural unemployment
Structural and cyclical unemployment
Frictional unemployment
Cycling and seasonal unemployment
Question 13:Discouraged workers are:
not included in the labour force
classified as unemployed
classified as underemployed
included in the labour force
Question 14:Ceteris paribus, which of the following will raise the natural rate of unemployment:
an increase in the demand for labour
a decrease in the supply of labour due to an increase in the average time spent searching for the right job
a decrease in the labour force
none of the above
Question 15:When the economy is at full employment:
the entire working age population is employed
the entire labour force is employed
frictional and structural unemployment together account for total unemployment
cyclical unemployed accounts for total unemployment
Question 16:When you regularly deposit $100 a week into your bank account so that you can buy a new car sometime in the future, you are using money as:
a medium of exchange
a unit of account
a store of value
none of the above
Question 17:Which of the following is money?
the credit balance in your cheque account
all the blank cheques left in your cheque book
your Visa credit card
the government bond you own
Question 18:Which is the most liquid of these assests?
cheque account deposits
a block of land
Telstra bonds
Term deposit in a building society
Question 19:Which of the following events will trigger a rightward shift of the demand for money curve?
price level
money supply
interest rate
real GDP rises
Question 20:If the economy is initially at full-employment equilibrium, an increase in supply of (real) money will result in:
a sustained increased in real GDP, but the price level falls
a sustained increased in the price level, but only a tempory increase in the real GDP
a sustained increased in real GDP, but only a tempory increase in the price level
a sustained increased in real GDP and increase in price level
Question 21:Under a flexible exchange rate regime, if there is a shortage of foreign exchange at the current exchange rate, the Reserve Bank will:
sell foreign exchange
buy foreign exchange impose exchange control
do nothing
Question 22:Which exchange rate regimes lets market forces determine the foreign exchange rate?
flexible exchange rate system
managed exchange rate system
fixed exchange rate system
none of the above
Question 23:Which of the following gives rise to a demand for foreign exchange in Australia?
an Australian company buys a factory in the UK
an American company sends dividends to its Australian share holders
Australia exports live crayfish to Japan
Foreigners buy luxury apartments in Queensland
Question 24:Which of the following is not recorded in the current account?
net exports of goods and services
Dividends paid by Australian companies to foreign share-holders
Pensions paid by Australian government to elderly citizens who are now residing overseas
Australia's investment overseas
Question 25:Which of the following will lead to a reduction in Australian external debt?
a decrease in its current account deficit
an increase in its current account deficit
a current account surplus
a capital account surplus

This Quiz has been designed by May.