Econ 102 - Principles of Macroeconomics » Fall 2022 » Business Cycle Quiz

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Question #1
A new technological innovation would increase
A.   population growth.
B.   labor productivity.
C.   the labor force.
D.   labor hours worked.
Question #2
A recession is defined by economists as a time period when:
A.   consumer confidence is low
B.   real GDP has declined for at least two quarters
C.   unemployment is rising
D.   business profits are falling
Question #3
According to economists, one of the signs of an unhealthy economy is a(n)
A.   rising labor productivity.
B.   declining real GDP.
C.   increasing real GDP.
D.   declining unemployment.
Question #4
During the Great Depression which of the following was true?
A.   business profits were growing
B.   consumer confidence was euphoric
C.   the rate of inflation was increasing
D.   the rate of investment was negative
Question #5
Environmentalists worry that economic growth imposes costs on society. Among these costs are
A.   waste disposal.
B.   crowding.
C.   All of these are costs.
D.   pollution.
Question #6
Human Capital refers to.
A.   the ability of humans to make capital goods
B.   tools and machinery
C.   education, training and health of a labor force
D.   plant and equipment
Question #7
If the capital stock increases, then the economy can produce ____ output with the ____ amount of labor.
A.   less, less
B.   more, same
C.   same, same
D.   less, same
Question #8
If the government chose to increase purchases (G) on education
A.   There will be no impact on output
B.   Labor productivity should decline
C.   Potential output should decrease
D.   Potential output should increase
Question #9
One basic way to boost the nation's growth rate is to
A.   accumulate less capital
B.   increase wages paid to labor.
C.   reduce the population growth rate.
D.   increase the rate of technical progress.
Question #10
One of the key factors that determine an economy's real GDP is labor productivity, which is a measure of
A.   labor force per hour.
B.   input per hour worked.
C.   output per hour of work.
D.   total hours worked.
Question #11
Potential GDP is an estimate of the economy's ability to produce goods and services if the
A.   price level is stable.
B.   trade balance is zero.
C.   labor force is fully employed.
D.   federal budget is balanced.
Question #12
The phase of a business cycle during which real GDP reaches it's minimum level is the:
A.   depression
B.   recovery
C.   recession
D.   trough
Question #13
Which of the following statements is true?
A.   Generally during a prosperity period wages rise as unemployment falls.
B.   The four phases of the business cycle, in order, are peak, recovery, trough and recession.
C.   Full employment exists in an economy when the unemployment rate equals the sum of frictional and cyclical unemployment rates.
D.   When unemployment is rising, then real GDP is rising.
Question #14
Which of the following indicators is a leading indicator?
A.   interest rates
B.   unemployment
C.   inflation
D.   business profits
Question #15
Which of the following indicators is a counter-cyclical indicator?
A.   interest rates
B.   unemployment
C.   business profits
D.   inflation

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