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.   the labor force.
C.   population growth.
D.   labor productivity.
Question #2
A recession is defined by economists as a time period when:
A.   real GDP has declined for at least two quarters
B.   business profits are falling
C.   unemployment is rising
D.   consumer confidence is low
Question #3
According to economists, one of the signs of an unhealthy economy is a(n)
A.   rising labor productivity.
B.   declining unemployment.
C.   increasing real GDP.
D.   declining real GDP.
Question #4
During the Great Depression which of the following was true?
A.   the rate of inflation was increasing
B.   consumer confidence was euphoric
C.   business profits were growing
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.   All of these are costs.
C.   pollution.
D.   crowding.
Question #6
Human Capital refers to.
A.   education, training and health of a labor force
B.   tools and machinery
C.   the ability of humans to make capital goods
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.   increase the rate of technical progress.
B.   accumulate less capital
C.   increase wages paid to labor.
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.   input per hour worked.
B.   labor force per hour.
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.   labor force is fully employed.
B.   trade balance is zero.
C.   price level is stable.
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.   trough
C.   recession
D.   recovery
Question #13
Which of the following statements is true?
A.   The four phases of the business cycle, in order, are peak, recovery, trough and recession.
B.   Generally during a prosperity period wages rise as unemployment falls.
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.   business profits
B.   interest rates
C.   inflation
D.   unemployment
Question #15
Which of the following indicators is a counter-cyclical indicator?
A.   interest rates
B.   inflation
C.   unemployment
D.   business profits

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