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

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

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