Econ 102 - Principles of Macroeconomics » Fall 2022 » AS AD Model Changes After the 1960s Quiz

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Question #1
Recessionary gaps usually lead to
A.   frictional unemployment.
B.   cyclical unemployment.
C.   seasonal unemployment.
D.   structural unemployment.
Question #2
Which of the following is evidence of an inflationary gap?
A.   very low unemployment rates
B.   very low sales figures
C.   very long lines at employment agencies
D.   very short waiting times for product delivery
Question #3
For most firms in the economy, the largest part of factor cost is the cost of
A.   capital.
B.   land and natural resources.
C.   labor.
D.   property and machinery.
Question #4
An inflationary gap exists when consumers
A.   and businesses are demanding more than the economy is capable of producing.
B.   and businesses are demanding less than the full employment level of output.
C.   and businesses are purchasing less than the economy is capable of producing.
D.   are saving more than businesses are investing.
Question #5
As a result of the war in Afghanistan, the population of Afghanistan as well as their capital stock was reduced. This can be illustrated by aggregate supply curve
A.   becoming more elastic.
B.   shifting outward.
C.   shifting inward.
D.   becoming flatter.
Question #6
The existence of an inflationary gap would tend to benefit most
A.   retired persons.
B.   stock owners.
C.   unemployed workers.
D.   bankers.
Question #7
The combination of high unemployment and high inflation is termed
A.   stagflation
B.   depression
C.   reflation.
D.   unflation.
Question #8
Educational reforms that result in improved reading and math skills of high school graduates as they enter the labor force would do what to the aggregate supply curve?
A.   Move the economy up along the curve.
B.   Move the economy down along the curve.
C.   Shift it inward.
D.   Shift it outward.
Question #9
If the price level increases, what will happen to the level of real GDP supplied?
A.   Nothing.
B.   It will decrease at first then increase.
C.   It will decrease.
D.   It will usually increase.
Question #10
In spite of the fact that unemployment rates were at a 30-year low in 1996-2000, the United States economy also experienced
A.   balance of payments surpluses.
B.   large budget deficits.
C.   low growth.
D.   declining inflation.

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