UMUC ECON 201 Quiz 1 and 2 Latest 2015 (40 QUESTIONS)

UMUC ECON 201 Quiz 1 and 2 Latest 2015 (40 QUESTIONS)

Question

Question 1. Macroeconomic topics do not usually include:

a) the profit maximizing decisions of an individual manufacturer.

b) economic growth.

c) the rate of inflation.

d) the rate of unemployment.

Question 2. When nations desire a healthy macroeconomy, they typically focus on three goals, one of these being:

a) low inflation

b) balanced budget

c) prudent monetary policy

d) assuring competition between firms

Question 3. If macroeconomics looks at the economy as a whole, it focuses on which of the following?

a) the division of labor

b) households

c) business firms

d) unemployed people

Question 4. In the ______________, households receive goods and services and pay firms for them.

a) goods and services market

b) labor market

c) financial capital market

d) savings market

Question 5. Which of the following is included in the calculated Gross Domestic Product?

a) Farmer Freddie sells his second tractor to his son.

b) Suzanne buys a love seat and chair for $85 at the yard sale on the corner.

c) A local ice cream store sells $17,000 worth of cones and sundaes on July 1.

d) Mr. Farkle buys a used lawn mower from his neighbor, Mr. Sparkle.

Question 6. _______________, which can be approximated by the growth of gross domestic product, ultimately determines the prevailing standard of living in a country.

a) Inflation

b) Trade balance

c) Economic growth

d) Education

Question 7. GDP does not directly include:

a) the value of final goods and services produced, but not sold, during a period.

b) the value of services rendered during a period.

c) the value of intermediate goods sold during a period.

d) the value of goods produced domestically and sold abroad.

Question 8. A business cycle reflects changes in economic activity, particularly real GDP. The stages of a business cycle are:

a) expansion, trough, recession, peak

b) trough, expansion, recession, peak

c) contraction, recession, expansion, boom

d) expansion, peak, recession, trough

Question 9. Ethiopia has a GDP of $8 billion (measured in U.S. dollars) and a population of 55 million. Costa Rica has a GDP of $9 billion (measured in U.S. dollars) and a population of 4 million. Calculate per capita GDP for each country.

a) Ethiopia = $145.00 Costa Rica = $2250.00

b) Ethiopia = $1450.00 Costa Rica = $22,500.00

c) Ethiopia = $14.50 Costa Rica = $225.00

d) Ethiopia = $14.50 Costa Rica = $2250.00

Question 10. Country Able and Country Baker initially have the same real GDP per capita. Country Able experiences no economic growth, while Country Baker grows at a sustained rate of 7 percent. In 12 years, Country Baker’s GDP will be approximately ___________ that of Country Able.

a) one-half

b) one-fourth

c) triple

d) double

Question 11. Increased investment alone will guarantee economic growth.

a) This is a true statement, because growth occurs only with savings.

b) This is a false statement, because economic growth hinges on the quality and type of investment as well as the human capital and improvements in technology.

c) This is a false statement, because an economy must rely on capital injections from abroad.

d)  This is a true statement, because money is the only resource needed for growth.

Question 12. Some recent economic research has suggested that African countries’ economic growth may have been limited by __________________ .

a) population

b) geography and climate

c) government interventionism

d) technological challenges

Question 13. A nation’s prosperity is sometimes measured in terms of ___________.

a) GNP

Correct Response

b) GDP per capita

c) GDP

d) economic output

Question 14. A university student who is enrolled in school fulltime and not seeking employment is considered:

a) underemployed.

b) unemployable, and not counted in official statistics.

c) out of the labor force.

d) employed in leisure.

Question 15. The unemployment rate may overestimate the true extent of unemployment if:

a) many part-time employees would like to work fulltime, but are unable to get the additional work.

b) many people who claim to be unemployed actually work in the underground economy.

c) people falsely claim that they are actively seeking work in order to receive unemployment benefits.

d) either B) or C) occurs.

Question 16. A welder who quits his job and moves from Pittsburgh to Madison to try to get a better welding job is said to be:

a) structurally unemployed.

b) underemployed.

c) cyclically unemployed.

d) frictionally unemployed.

Question 17. The effect of substitution bias is that the rise in the price of a fixed basket of goods over time tends to ___________________ the rise in a consumer’s true cost of living, because it doesn’t take into account that the person can substitute between goods according to changes in their relative prices.

a) overstate

b) stabilize

c) reduce

d) understate

Question 18. When a price, wage, or interest rate is adjusted automatically with inflation, it is said to be __________.

a) COLAed

b) indexed

c) semi-indexed

d) nominally adjusted

Question 19. Alex wants to measure the nominal 1998 GDP of $993 billion in 2008 dollars. From the data he gathered, he knows the deflator for 1998 is 30 and for 2008, it is 74, and that real interest in those years was 6.23% and 3.21% respectively. If he avoids making a misleading calculation, what will the value be?

a) $2,063 billion

b) $835 billion

c) $430 billion

d) $2,449 billion

Question 20. If the price index moves from 107 to 110, the rate of inflation is:

a) 30%

b) 2.8%

c) 3%

d) 28%

 

Quiz 2

Question 1. The _____________ holds that a rise in price level will make domestic goods relatively more expensive, ____________ exports and _______________ imports.

a) employment effect; discouraging; encouraging

b) interest rate effect; encouraging; discouraging

c) wealth effect; encouraging; discouraging

 

d) foreign price effect; discouraging; encouraging

UMUC ECON 201 Quiz 1 and 2 Latest 2015 (40 QUESTIONS)