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Macro ALL weeks (9-14)

time limit:t < 30 min - Developed by: May - Developed on: 2002-06-15 - 4,120 taken - User Rating: 4,2 of 5 - 6 Votes

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.