中级宏观经济学付费版题库10经济波动导论..doc

Name: __________________________ Date: _____________

1.
Business cycles are:
A)
regular and predictable.
B)
irregular but predictable.
C)
regular but unpredictable.
D)
irregular and unpredictable.

2.
Short-run fluctuations in output and employment are called:
A)
sectoral shifts.
B)
the classical dichotomy.
C)
business cycles.
D)
productivity slowdowns.

3.
Recessions typically, but not always, include at least ______ consecutive quarters of declining real GDP.
A)
two
B)
four
C)
six
D)
eight

4.
Over the business cycle, investment spending ______ consumption spending.
A)
is inversely correlated with
B)
is more volatile than
C)
has about the same volatility as
D)
is less volatile than

5.
When GDP growth declines, investment spending typically ______ and consumption spending typically ______.
A)
increases; increases
B)
increases; decreases
C)
decreases; decreases
D)
decreases; increases

6.
Okun's law is the ______ relationship between real GDP and the ______.
A)
negative; unemployment rate
B)
negative; inflation rate
C)
positive; unemployment rate
D)
positive; inflation rate

7.
The statistical relationship between changes in real GDP and changes in the unemployment rate is called:
A)
the Phillips curve.
B)
the Solow residual.
C)
the Fisher effect.
D)
Okun's law.

8.
The version of Okun's law studied in Chapter 10 assumes that with no change in unemployment, real GDP normally grows by 3 percent over a year. If the unemployment rate rose by 2 percentage points over a year, Okun's law predicts that real GDP would:
A)
decrease by 1 percent.
B)
decrease by 2 percent.
C)
decrease by 3 percent.
D)
increase by 1 percent.

9.
The version of Okun's law studied in Chapter 10 assumes that with no change in unemployment, real GDP normally grows by 3 percent over a year. If the unemployment rate fell by 1 percentage point over a year, Okun's law predicts that real GDP would:
A)
decrease by 1 percent.
B)
decrease by 2 percent.
C)
increase by 4 percent.
D)
increase by 5 percent.

10.
Long-run growth in real GDP is determined primarily by ______, while short-run movements in real GDP are associated with ______.
A)
variations in labor-market utilization; technological progress
B)
technological progress; variations in labor-market utilization
C)
money supply growth rates; changes in velocity
D)
changes in velocity; money supply growth rates

11.
Leading economic indicators are:
A)
the most popular economic statistics.
B)
data that are used to construct the consumer price index and the unemployment rate.
C)
variables that tend to fluctuate in advance of the overall economy.
D)
standardized statistics compiled by the National Bureau of Economic Research.

12.
A decline in the Index of Supplier Deliveries is typically an indicator of a future _____ in economic production, and a narrowing of the interest rate spread between the 10-year Treasury note and 3-month Treasury bill is typically an indicator of a future _____ in economic production.
A)
increase; slowdown
B)
increase; increase
C)
slowdown; increase
D)
slowdown; slowdown

13.
The index of leading indicators compiled by the Conference Board includes 10 data series that are used to forecast economic activity about ______ in advance.
A)
one month
B)
six to nine months
C)
one to two years
D)
five to ten years

14.
Measures of average workweeks and of supplier deliveries (vendor performance) are included in the index of leading indicators, because shorter workweeks tend to indicate ______ future economic activity and slower deliveries tend to indicate ______ future economic activity.
A)
stronger; stronger
B)
stronger; weaker
C)
weaker; stronger
D)
weaker; weaker

15.
Most economists believe that prices are:
A)
flexible in the short run but many are sticky in the long run.
B)
flexible in the long run but many are sticky in the short run.
C)
sticky in both the short and long runs.
D)
flexible in both the short and long runs.

16.
Most economists believe that the classical dichotomy:
A)
holds approximately in both the short run and the long run.
B)
holds approximately in the long run but not at all in the short run.
C)
holds approximately in the short run but not at all in the long run.
D)
does not hold even approximately in either the long run or the short run.

17.
A 5 percent reduction in the money supply will, according to most economists, reduce prices 5 percent:
A)
in both the short and long runs.
B)
in neither the short nor long run.
C)
in the short run but lead to unemployment in the long run.
D)
in the long run but lead to unemployment in the short run.

18.
Monetary neutrality, the irrelevance of the money supply in determining values of _____ variables, is generally thought to be a property of the economy in the long run.
A)
real
B)
nominal
C)
real and nominal
D)
neither real nor nominal

19.
Alan Blinder's survey of firms found that the typical firm adjusts its prices:
A)
more than once a week.
B)
about once a month.
C)
once or twice a year.
D)
less than once a year.

20.
Alan Blinder's survey of firms found that the theory of price stickiness accepted by the most firms was:
A)
menu costs.
B)
coordination failure.
C)
nominal contracts.
D)
procyclical elasticity.

21.
All of the following are suggested by the results of Alan Blinder's survey of firms except:
A)
there is only one theory of price stickiness.
B)
coordinating wage and price setting could improve welfare.
C)
reasons for price stickiness vary by industry.
D)
activist monetary policy can be used to cure recessions.

22.
A difference between the economic long run and the short run is that:
A)
the classical dichotomy holds in the short run but not in the long run.
B)
monetary and fiscal policy affect output only in the long run.
C)
demand can affect output and employment in the short run, whereas supply is the ruling force in the long run.
D)
prices and wages are sticky in the long run only.

23.
The aggregate demand curve is the ______ relationship between the quantity of output demanded and the ______.
A)
positive; money supply
B)
negative; money supply
C)
positive; price level
D)
negative; price level

24.
The relationship between the quantity of output demanded and the aggregate price level is called:
A)
aggregate demand.
B)
aggregate supply.
C)
aggregate output.
D)
aggregate consumption.

25.
If an aggregate demand curve is drawn with real GDP (Y) along the horizontal axis and the price level (P) along the vertical axis, using the quantity theory of money as a theory of aggregate demand, this curve slopes ______ to the right and gets ______ as it moves farther to the right.
A)
downward; steeper
B)
downward; flatter
C)
upward; steeper
D)
upward; flatter

26.
The assumption of constant velocity in the quantity equation is the equivalent of the assumption of a constant:
A)
short-run aggregate supply curve.
B)
long-run aggregate supply curve.
C)
price level in the short run.
D)
demand for real balances per unit of output.

27.
Along an aggregate demand curve, which of the following are held constant?
A)
real output and prices
B)
nominal output and velocity
C)
the money supply and real output
D)
the money supply and velocity

28.
According to the quantity theory of money, if output is higher, ______ real balances are required, and for fixed M this means ______ P.
A)
higher; lower
B)
lower; higher
C)
higher; higher
D)
lower; lower

29.
According to the quantity equation, if the velocity of money and the supply of money are fixed, and the price level increases, then the quantity of goods and services purchased:
A)
increases.
B)
decreases.
C)
does not change.
D)
may either increase or decrease.

30.
For a fixed money supply, the aggregate demand curve slopes downward because at a lower price level real money balances are ______, generating a ______ quantity of output demanded.
A)
higher; greater
B)
higher; smaller
C)
lower; greater
D)
lower; smaller

31.
The aggregate demand curve tells us possible:
A)
combinations of M and Y for a given value of P.
B)
combinations of M and P for a given value of Y.
C)
combinations of P and Y for a given value of M.
D)
results if the Federal Reserve reduces the money supply.

32.
When an aggregate demand curve is drawn with real GDP (Y) along the horizontal axis and the price level (P) along the vertical axis, if the money supply is decreased, then the aggregate demand curve will shift:
A)
downward and to the left.
B)
downward and to the right.
C)
upward and to the left.
D)
upward and to the right.

33.
When the Federal Reserve reduces the money supply, at a given price level the amount of output demanded is ______ and the aggregate demand curve shifts ______.
A)
greater; inward
B)
greater; outward
C)
lower; inward
D)
lower; outward

34.
When the Federal Reserve increases the money supply, at a given price level the amount of output demanded is ______ and the aggregate demand curve shifts ______.
A)
greater; inward
B)
greater; outward
C)
lower; inward
D)
lower; outward

35.
Looking at the aggregate demand curve alone, one can tell ______ that will prevail in the economy.
A)
the quantity of output and the price level
B)
the quantity of output
C)
the price level
D)
neither the quantity of output nor the price level

36.
The relationship between the quantity of goods and services supplied and the price level is called:
A)
aggregate demand.
B)
aggregate supply.
C)
aggregate investment.
D)
aggregate production.

37.
Aggregate supply is the relationship between the quantity of goods and services supplied and the:
A)
money supply.
B)
unemployment rate.
C)
interest rate.
D)
price level.

38.
A short-run aggregate supply curve shows fixed ______, and a long-run aggregate supply curve shows fixed ______.
A)
output; output
B)
prices; prices
C)
prices; output
D)
output; prices

39.
In the long run, the level of output is determined by the:
A)
interaction of supply and demand.
B)
money supply and the levels of government spending and taxation.
C)
amounts of capital and labor and the available technology.
D)
preferences of the public.

40.
When a long-term aggregate supply curve is drawn with real GDP (Y) along the horizontal axis and the price level (P) along the vertical axis, this curve:
A)
slopes upward and to the right.
B)
slopes downward and to the right.
C)
is horizontal.
D)
is vertical.

41.
The vertical long-run aggregate supply curve satisfies the classical dichotomy because the natural rate of output does not depend on:
A)
the labor supply.
B)
the supply of capital.
C)
the money supply.
D)
technology.

42.
If the long-run aggregate supply curve is vertical, then changes in aggregate demand affect:
A)
neither prices nor level of output.
B)
both prices and level of output.
C)
level of output but not prices.
D)
prices but not level of output.

43.
The natural level of output is:
A)
affected by aggregate demand.
B)
the level of output at which the unemployment rate is zero.
C)
the level of output at which the unemployment rate is at its natural level.
D)
permanent and unchangeable.

44.
The long-run aggregate supply curve is vertical at the level of output:
A)
determined by aggregate demand.
B)
at which unemployment is at its natural rate.
C)
at which the inflation rate is zero.
D)
at a predetermined price level.

45.
If all prices are stuck at a predetermined level, then when a short-run aggregate supply curve is drawn with real GDP (Y) along the horizontal axis and the price level (P) along the vertical axis, this curve:
A)
is horizontal.
B)
is vertical.
C)
slopes upward and to the right.
D)
slopes downward and to the right.

46.
The price level decreases and output increases in the transition from the short run to the long run when the short-run equilibrium is _____ the natural rate of output in the short run.
A)
above
B)
below
C)
equal to
D)
either above or below

47.
If the short-run aggregate supply curve is horizontal, then changes in aggregate demand affect:
A)
level of output but not prices.
B)
prices but not level of output.
C)
both prices and level of output.
D)
neither prices nor level of output.

48.
In the aggregate demand–aggregate supply model, short-run equilibrium occurs at the combination of output and prices where:
A)
aggregate demand equals long-run aggregate supply.
B)
aggregate demand equals short-run aggregate supply.
C)
aggregate demand equals short-run and long-run aggregate supply.
D)
short-run aggregate supply equals long-run aggregate supply.

49.
If the short-run aggregate supply curve is horizontal, then the:
A)
classical dichotomy is satisfied.
B)
money supply cannot affect prices in the short run.
C)
money supply cannot affect output in the short run.
D)
money supply is irrelevant in the short run.

50.
The short-run aggregate supply curve is horizontal at:
A)
a level of output determined by aggregate demand.
B)
the natural level of output.
C)
the level of output at which the economy's resources are fully employed.
D)
a fixed price level.

51.
The short run refers to a period:
A)
of several days.
B)
during which prices are sticky and unemployment may occur.
C)
during which capital and labor are fully employed.
D)
during which there are no fluctuations.

52.
The long run refers to a period:
A)
of decades.
B)
during which capital and labor are sometimes not fully employed.
C)
during which prices are flexible.
D)
during which output deviates from the full-employment level.

53.
If the short-run aggregate supply curve is horizontal and the long-run aggregate supply curve is vertical, then a change in the money supply will change ______ in the short run and change ______ in the long run.
A)
only prices; only output
B)
only output; only prices
C)
both prices and output; only prices
D)
both prices and output; both prices and output

54.
In the aggregate demand–aggregate supply model, long-run equilibrium occurs at the combination of output and prices where:
A)
aggregate demand is greater than long-run aggregate supply.
B)
aggregate demand equals short-run aggregate supply.
C)
aggregate demand equals short-run and long-run aggregate supply.
D)
short-run aggregate supply equals long-run aggregate supply.

55.
If a short-run equilibrium occurs at a level of output above the natural rate, then in the transition to the long run prices will ______ and output will ______.
A)