Reference no: EM131501480

Assignment

Question 1
If government spending is used to bolster the level of economic activity, the type of financing available to the U.S. government that would increase aggregate spending the most is

taxation
borrowing from the public
borrowing from banks
printing money

Question 2
The Kennedy administration's guidepost for wage increases was related to

money supply
price increases
productivity increases
interest rates

Question 3
Fiscal policy deals with

interest rates
the money supply
the government budget
bank credit

Question 4
Cost-push inflation is characterized by

the wage-price spiral
administered pricing
stagflation
the multiplier

Question 5
The most effective means of stimulating the economy during a recession is for the federal government to

increase spending and hold taxes
hold government spending and decrease taxes
decrease government spending and hold taxes
decrease government spending and raise taxes

Question 6
The most effective way for the government to develop a surplus as a contractionary measure is to increase taxes and hold or decrease spending.

True
False

Question 7
Stagflation is a mixture of

low inflation and low unemployment
high inflation and low unemployment
low inflation and high unemployment
high inflation and high unemployment

Question 8
Fiscal policy is likely to be more effective than monetary policy when used to increase aggregate demand during periods of serious unemployment.

True
False

Question 9
Deflation and disinflation are synonymous terms.

True
False

Question 10
The policies of the New Deal in the 1930s, in an effort to alleviate unemployment, paralleled those of

Keynesian analysis
supply-side economics
Say's Law
the classical theory

Question 11
If business leaders thought an existing tax credit provision on new investment might be suspended because of inflation, this would cause

investment spending to slacken
investment spending to accelerate
no effect on investment plans
interest rates to decline

Question 12
A disadvantage of using public works to reduce unemployment is that

it is very difficult to end a government spending program once it develops a political constituency
large public works may require years to plan and get under way
increased government spending may not be appropriate by the time the public works project beings
all of the above

Question 13
Changing the discount rate is a tool of fiscal policy.

True
False

Question 14
The roughly coincident indicators have their upward and downward turning points prior to the upward and downward turning points of real GDP.

True
False

Question 15
A noticeable drop in the level of business activity is known as a

recession
collapse
lagging indicator
contraction

Question 16
During the expansion phase of the business cycle, profit margins increase due to a widening cost-price relationship.

True
False

Question 17
Prior to 2006, the most severe trough in a U.S. business cycle since the Great Depression occurred in 1982.

True
False

Question 18
Schumpeter's theory that business cycles are caused by breakthroughs in the form of new products, new machines, or new production techniques is known as the

real business cycle theory
innovative theory
overinvestment theory
technology theory

Question 19
The measurement of a business cycle is obtained by adjusting the real GDP for seasonal variation, the trend, and random fluctuations.

True
False

Question 20
According to the rational expectations theory,

the expected results of government anticyclical measures are intensified by the actions of businesses and individuals
the easy expansion of the money supply by banks eventually leads to excess productive capacity
the expected results of government anticyclical measures are offset by the actions of businesses and individuals
the limited expansion of the money supply by banks eventually leads to excess productive capacity

Question 21
The theory of rational expectations is classified as a psychological cause of the business cycle.

True
False

Question 22
In the pattern of the business cycle, generally

costs and prices move inversely
costs and prices move simultaneously
costs lead prices
costs lag behind prices

Question 23
A recession occurs whenever there's a decline in real GDP for two or more successive quarters.

True
False

Question 24
Recurring fluctuations in business activity over the course of one year are known as

seasonal variations
random fluctuations
the trend
the business cycle

Question 25
During the expansion phase of the business cycle, we would normally expect to see real income ________, price level ________, and unemployment rate_______.

increasing; increasing; increasing
increasing; decreasing; decreasing
increasing; increasing; decreasing
falling; increasing; increasing

Question 26
Which of the following is not a phase of the business cycle?

peak
trough
compression
expansion

Question 27
Employment discrimination refers to

differing economic opportunities offered to persons according to their productivity
wage differentials based on productivity differences
differing economic opportunities based on personal characteristics
wage differentials based on seniority and human capital

Question 28
Poverty is a condition that randomly strikes all members of the population equally.

True
False

Question 29
Household wealth is defined as income minus liabilities.

True
False

Question 30
In 2004, the top 5 percent of households earned approximately

5 percent of aggregate income
10 percent of aggregate income
15 percent of aggregate income
50 percent of aggregate income

Question 31
If new highly progressive tax laws are enacted, the resulting Lorenz curve will move to the right-hand corner of the graph.

True
False

Question 32
According to the Department of Commerce, a person living alone constitutes a single-person family.

True
False

Question 33
A country with an equal distribution of income will have a higher standard of living than a country with a more unequal distribution of income.

True
False

Question 34
The total number of people in poverty has changed little since the late 1960s.

True
False

Question 35
An income distribution in which all households receive exactly the same income is referred to as a(n)

just distribution of income
proportional distribution of income
equal distribution of income
equitable distribution of income

Question 36
The New Economy is one of

durable goods
services
information
manufacturing

Question 37
The poverty rate for female householders without a husband present exceeds the poverty rate for blacks and Hispanics.

True
False

Question 38
Geographically, a higher percentage of the poor live in the

Northeast
South
Midwest
West

Question 39
A sizable part of increases in the U.S. labor force in the past few decades has been due to the influx of women.

True
False

Question 40
Since 1970, U.S. union membership has

increased as a percentage of the labor force
declined as a percentage of the labor force
remained stable as a percentage of the labor force
become more restrictive

Question 41
The amount of unemployment that arises because workers are temporarily between jobs or new entrants to the labor force is known as

structural unemployment
cyclical unemployment
frictional unemployment
induced unemployment

Question 42
The total U.S. labor force excludes members of the armed services stationed outside the United States.

True
False

Question 43
The Employment Act of 1946 set a specific annual inflation rate target of 3 percent.

True
False

Question 44
The natural rate of unemployment is the rate of unemployment we would expect to find

when frictional and structural unemployment are equal
when all unemployment is structural or frictional
when there is no inflation in the economy
when structural unemployment has been eliminated

Question 45
Persons who do not work because of bad weather or vacation are part of

the unemployed labor force
the employed labor force
frictional unemployment
cyclical unemployment

Question 46
The official rate of unemployment is based on a(n)

door-to-door survey
telephone survey
employer survey
payroll survey

Question 47
In recent years, the U.S. labor force has experienced

an increase in the percentage of manufacturing workers
an increase in the percentage of older workers
an increase in the percentage of females
an increase in the percentage of unskilled workers

Question 48
Which of the following has not been outsourced from the U.S.?

customer service centers
data processing
residential construction
computer programming

Question 49
The Full Employment and Balanced Growth Act of 1978 is also known as the Deficit Reduction Act.

True
False

Question 50
In order to be effective, the minimum wage must be

increased every 3 years
above the market wage
below the market wage.