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Unformatted text preview: ch10 Student: ___________________________________________________________________________ 1. The study of aggregate economic behavior is referred to as: A. Microeconomics. B. Macroeconomics. C. Government policy. D. The business cycle. 2. A basic purpose of macroeconomic theory is to: A. Explain the business cycle. B. Stop economic contractions from occurring. C. Control the business cycle. D. Cause GDP to grow. 3. A basic purpose of macroeconomics is to explain: A. Why businesses pollute. B. How businesses choose the profit-maximizing rate of output. C. Why the economy expands or contracts. D. How and why countries trade with each other. 4. Alternating periods of growth and contraction in real GDP define: A. The business cycle. B. Capitalism. C. Inflation. D. Macro equilibrium. 5. Which of the following is not a basic measure of macroeconomic performance? A. Output growth B. Unemployment C. Public goods D. Inflation 6. Which of the following is a basic measure of macroeconomic performance? A. The U.S. stock market B. Growth in output C. The U.S. bond market D. Population growth 7. Which of the following is not one of the three basic measures of macroeconomic performance? A. Inflation B. Unemployment C. Antitrust D. GDP growth 8. The alternative combinations of goods and services that can be produced in a given time period with available resources and technology is referred to as: A. The business cycle. B. Real GDP. C. Nominal GDP. D. The production possibilities. 9. For a particular economy, the production possibilities curve shows the: A. Maximum potential output. B. Maximum level of pollution. C. Change in the price level. D. Level of market power. 10. The production possibilities will definitely shift outward if: A. Land and capital increase and, at the same time, the labor force decreases. B. Available resources decrease and, at the same time, technology improves. C. The labor force increases and, at the same time, technology improves. D. The labor force decreases and, at the same time, land and capital decrease. 11. Business cycles in the United States: A. Are similar in length but vary greatly in magnitude. B. Vary greatly in length, frequency, and magnitude. C. Are similar in frequency and magnitude. D. Are similar in length and magnitude. 12. Which of the following is characteristic of a downturn in the business cycle? A. Higher unemployment rates B. Higher prices C. Growth in real output D. Increased population 13. Which of the following is characteristic of a downturn in the business cycle? A. Lower unemployment rates B. An increase in population C. A decrease in real output D. A decrease in population 14. Which of the following is true during the expansionary phase of the business cycle?...
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- Fall '11