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macro95ex1 - Chapter 1 Introduction to Macroeconomics T...

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Chapter 1 Introduction to Macroeconomics T Multiple Choice Questions 1. The two major reasons for the tremendous growth in output in the U.S. economy over the last 125 years are (a) population growth and low inflation. (b) population growth and increased productivity. (c) low unemployment and low inflation. (d) low inflation and low trade deficits. Answer: B Level of difficulty: 1 Section: 1.1 2. The main reason that the United States has such a high standard of living is 3. Average labor productivity is the 4. In which of the following periods did average labor productivity in the United States grow the fastest?
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2 Abel/Bernanke • Macroeconomics, Fifth Edition 5. The most direct effect of an increase in the growth rate of average labor productivity would be an increase in (a) the inflation rate. (b) the unemployment rate. (c) the long–run economic growth rate. (d) imported goods. Answer: C Level of difficulty: 1 Section: 1.1 6. Short-run contractions and expansions in economic activity are called 7. When national output rises, the economy is said to be in 8. Which of the following best describes a typical business cycle? 9. During recessions, the unemployment rate ___________ and output ___________. (a) rises; falls (b) rises; rises (c) falls; rises (d) falls; falls Answer: A Level of difficulty: 1 Section: 1.1
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Chapter 1 Introduction to Macroeconomics 3 10. The number of unemployed divided by the labor force equals
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