ID: A Date: Class: Name: ECON 40 FINAL EXAM FALL 2017 Multiple Choice ldentify t
ID: 1128207 • Letter: I
Question
ID: A Date: Class: Name: ECON 40 FINAL EXAM FALL 2017 Multiple Choice ldentify the choice that best completes the statement or answers the question Macroeconomics is the study of a. the economic motives of voters and elected officials b. individual decision-making units such as households and businesses. c. how government purchases affect specific markets. d. the operation of the economy as a whole e. the interaction between the govermment and businesses. 1. 2. Which of the following is a macroeconomic question? How many textbooks should be published by a publisher? b. a. How much should English majors earn after college? How do members of a household decide whether to clean their own houses or hire someone else to do it? What is the rate of unemployment? What is the price of a new 40-inch television? c. d. c. A health insurance company may offer its policyholders a discount on their premiums if they prove that they have stopped smoking. What type of incentive is the health insurance company offering? 3. direct d. complementary b. indirect c. neutral 4. Is there an opportunity cost to increased investment in capital goods today? a. b. Yes, increased production of capital goods means fewer consumer goods today. Yes, increased production of capital goods today means less economic growth in the future. c. No, increased production of capital goods today does not mean fewer consumer goods today d. No, increased production of capital goods today guarantees more consumption today e. No, if society is producing at an efficient point on the production possibilities frontier (PPF), then there is no opportunity cost to investment in capital goods 5. Wilbur and Orville Wright's testing of wing designs in a wind tunnel is an example of using a. observations to construct models. b. hypotheses to test observations. c. a theory to formulate hypotheses. d. e. models to collect data. data to make predictions. There was a more than proportional decrease in quantity demanded for cupcakes when the local baker raised the price by 20 percent. The price elasticity of demand for cupcakes is a. inelastic. b. elastic. c- perfectly inelastic. 6. d. perfectly elastic. e. unitary elastic.Explanation / Answer
Macroeconomics is the study of the operation of the economy as a whole. It is not concerned with individual units like households or businesses but the entire economy and its activities. Macroeconomics studies the economy at various levels whether it is local, regional, state or national levels. It consists of the study of:
- GDP and National Income
- Inflation
- Employment
- Foreign Trade
- Government expenditure
- Monetary and Fiscal policies, etc.