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| 1.
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Average labour productivity is calculated as: |
| | A) | The ratio of real GDP to the total labour force |
| | B) | Real GDP divided by the total population |
| | C) | The ratio of real GDP to the number of people employed |
| | D) | Real GDP divided by the numbers employed and registered
as unemployed |
| | E) | The ratio of real GDP to the numbers employed in
manufacturing |
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| 2.
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In Euroland population increased from 2 million to 4 million, the number of employed workers increased from 1 million to 2 million, but average labor productivity decreased from €25,000 per worker per year to €20,000 per worker per year. Total output in Euroland _____ and the average standard
of living _____. |
| | A) | decreased; decreased |
| | B) | decreased; increased |
| | C) | increased; remained constant |
| | D) | increased; increased |
| | E) | increased; decreased |
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| 3.
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A cut in the rate of income tax is an example of ______ policy. |
| | A) | Aggregation |
| | B) | Fiscal |
| | C) | Monetary |
| | D) | Structural |
| | E) | Productivity |
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| 4.
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A decision by a government to sell state owned businesses to private investors is an example of ________ policy. |
| | A) | Aggregation |
| | B) | Fiscal |
| | C) | Monetary |
| | D) | Structural |
| | E) | International |
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| 5.
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To aggregate 300 tons of steel, 5,000 bushels of wheat, and 1 million barrels of crude oil, economists add together the _____ of the three products |
| | A) | Units |
| | B) | Euro value |
| | C) | Physical volume |
| | D) | Weight |
| | E) | Number of tons, bushels, and barrels |
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| 6.
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In Euroland exports equal 25% of total output, while imports equal 20% of total output. Euroland has: |
| | A) | A budget surplus. |
| | B) | A budget deficit. |
| | C) | A trade surplus. |
| | D) | A trade deficit. |
| | E) | Balanced trade. |
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| 7.
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Which of the following is an example of monetary policy? |
| | A) | The government decides to finance an increase in its deficit
by issuing new bonds |
| | B) | The government decides to finance an increase in its deficit
from higher taxation |
| | C) | The government uses a budget surplus to repay existing
debt |
| | D) | A reduction in the tax rates imposed on interest income |
| | E) | The central bank increases interest rates |
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| 8.
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Inflation is an issue for macroeconomic policymakers because inflation: |
| | A) | Imposes costs on the economy. |
| | B) | Allows people on fixed incomes to improve their standard of
living. |
| | C) | Was high in the 1970s, but relatively low in the 1990s. |
| | D) | Rates are similar in all countries. |
| | E) | Rates have been stable over time in most countries. |
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| 9.
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The unemployment rate _____ during recessions and _____ during expansions. |
| | A) | Increases; equals zero |
| | B) | Increases; decreases |
| | C) | Increases; is below zero |
| | D) | Decreases; equals zero |
| | E) | Decreases; is below |
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| 10.
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British exports to Spain are called ______ EU trade and Spanish imports from Russia are called ______ EU trade |
| | A) | Extra; intra |
| | B) | Intra; extra |
| | C) | Surplus; deficit |
| | D) | Deficit; surplus |
| | E) | External; internal |
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