Chapter 5 Questions - Sample Questions Chapter- 5 Multiple...

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Sample Questions Chapter- 5 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. The basic organizing framework for both microeconomic and macroeconomic models is a. purely competitive markets. b. government planning of the economy. c. demand and supply. d. democratic socialism. e. all of the above. ____ 2. If aggregate demand shifts inward over a long period of time, with aggregate supply held constant, the eco- nomy should experience a. unemployment. b. recession. c. stagflation. d. inflation. e. budget surpluses. ____ 3. In the aggregate demand-aggregate supply model, economic growth can be illustrated by an a. outward shift of the aggregate demand curve. b. inward shift of the aggregate demand curve. c. inward shift of the aggregate supply curve. d. All of the above. ____ 4. The clearest sign of inflation would be a(n) a. increase in the price level. b. increase in the quantity of total final output. c. decrease in the quantity of total final output. d. simultaneous increase in both output and prices. ____ 5. Nominal GDP is a. also called real GDP. b. a more accurate measure than real GDP. c. real GDP adjusted for changes in the price level. d. GDP measured in current prices. ____ 6. Real GDP a. is nominal GDP adjusted for changes in the price level. b. is also called nominal GDP. c. measures GDP minus depreciation of capital. d. will always change when prices change. ____ 7. If the prices of all goods and services rise during the year, a. real GDP may fall. b. nominal GDP must rise. c. nominal GDP may increase. d. real GDP must rise. ____ 8. The clearest sign of economic growth is a(n) a. increase in nominal GDP. b. increase in the level of real GDP. c. decrease in the level of nominal GDP. d. increase in nominal GDP.
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____ 9. A good produced in 2000 and held in inventory until it is sold in 2001 would be included in which measure of GDP? a. Half the value in 2000 and half the value in 2001 b. In 2001 GDP c. In both 2000 and 2001 GDP d. In 2000 GDP ____ 10. A real estate salesperson sells a house in 1999 that was built in 1990. How does this transaction get counted in the GDP statistics? a.
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This note was uploaded on 04/01/2008 for the course ECON 201 taught by Professor Dewan during the Spring '08 term at Eastern Michigan University.

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Chapter 5 Questions - Sample Questions Chapter- 5 Multiple...

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