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Unformatted text preview: Chapter 23 - An Introduction to Macroeconomics Chapter 23 An Introduction to Macroeconomics Multiple Choice Questions 1. Macroeconomics is mostly focused on: A. the individual markets within an economy. B. only the largest industries in the economy. C. the economy as a whole. D. why specific businesses fail. 2. The two topics of primary concern in macroeconomics are: A. short-run fluctuations in output and employment, and long-run economic growth. B. unemployment, and wage rates in labor markets. C. monopoly power of corporations, and small business profitability. D. oil prices and housing markets. 3. The business cycle depicts: A. fluctuations in the general price level. B. the phases a business goes through from when it first opens to when it finally closes. C. the evolution of technology over time. D. short-run fluctuations in output and employment. 4. The term "recession" describes a situation where: A. inflation rates exceed normal levels. B. output and living standards decline. C. an economy's ability to produce is destroyed. D. government takes a less active role in economic matters. 5. Which of the following is most closely related to recessions? A. positive long-run economic growth B. rapid growth in the price level C. falling rates of unemployment D. negative growth in output 23-1 Chapter 23 - An Introduction to Macroeconomics 6. Which of the following statements is most accurate about advanced economies? A. Economies experience a positive growth trend over the short run, but experience significant variability in the long run. B. Economies experience a positive growth trend over the long run, but experience significant variability in the short run. C. Economies experience positive and stable growth over both the long run and short run. D. Economies experience little long-run growth in output, but can experience significant growth in the short run. 7. Real GDP measures the: A. total dollar value of all goods and services produced within the borders of a country using current prices. B. value of final goods and services produced within the borders of a country, corrected for price changes. C. total dollar value of all goods and services consumed within the borders of a country, adjusted for price changes. D. value of all goods and services produced in the world, using current prices. 8. If the prices of all goods and services rose, but the quantity produced remained unchanged, what would happen to nominal and real GDP? A. nominal and real GDP would both rise. B. nominal and real GDP would both be unchanged. C. real GDP would rise, but nominal GDP would be unchanged. D. nominal GDP would rise, but real GDP would be unchanged. 9. Real GDP is preferred to nominal GDP as a measure of economic performance because: A. nominal GDP uses current prices and thus may over- or understate true changes in output....
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