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

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Question #1
A new technological innovation would increase
A.   labor productivity.
B.   population growth.
C.   labor hours worked.
D.   the labor force.
Question #2
A recession is defined by economists as a time period when:
A.   unemployment is rising
B.   business profits are falling
C.   real GDP has declined for at least two quarters
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.   rising labor productivity.
D.   increasing real GDP.
Question #4
During the Great Depression which of the following was true?
A.   the rate of investment was negative
B.   the rate of inflation was increasing
C.   consumer confidence was euphoric
D.   business profits were growing
Question #5
Environmentalists worry that economic growth imposes costs on society. Among these costs are
A.   crowding.
B.   waste disposal.
C.   All of these are costs.
D.   pollution.
Question #6
Human Capital refers to.
A.   tools and machinery
B.   the ability of humans to make capital goods
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.   more, same
B.   same, same
C.   less, same
D.   less, less
Question #8
If the government chose to increase purchases (G) on education
A.   There will be no impact on output
B.   Potential output should increase
C.   Potential output should decrease
D.   Labor productivity should decline
Question #9
One basic way to boost the nation's growth rate is to
A.   increase the rate of technical progress.
B.   accumulate less capital
C.   reduce the population growth rate.
D.   increase wages paid to labor.
Question #10
One of the key factors that determine an economy's real GDP is labor productivity, which is a measure of
A.   input per hour worked.
B.   output per hour of work.
C.   labor force per hour.
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.   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.   depression
B.   recession
C.   recovery
D.   trough
Question #13
Which of the following statements is true?
A.   Generally during a prosperity period wages rise as unemployment falls.
B.   When unemployment is rising, then real GDP is rising.
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.   interest rates
B.   unemployment
C.   inflation
D.   business profits
Question #15
Which of the following indicators is a counter-cyclical indicator?
A.   unemployment
B.   business profits
C.   interest rates
D.   inflation

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