ECON 400 TEST 3 QUESTIONS AND ANSWERS
Prior to World War II, - Answers - the growth of real GDP was less stable than has been
the case since the war.
Which one of the following is correct about the yield curve during normal times? -
Answers - Interest rates on longer maturity bonds tend to be higher than shorter
maturity bonds.
Those who favor active use of monetary and fiscal policy believe that - Answers -
discretionary changes in macroeconomic policy can help smooth the business cycle of a
market economy.
The privately held government debt is that portion of the national debt that - Answers -
is owed to domestic and foreign investors.
Measured as a share of GDP, the national debt of the United States? - Answers -
Soared to 120 percent of GDP in 2020, higher than at any time in American history.
The sum of all past budget deficits and surpluses of the federal government is the -
Answers - national debt.
Investment in both physical and human capital tends to enhance economic growth
because it generally - Answers - makes it possible for individuals to produce more
goods and services per hour worked
When the money supply is expanding and prices rise rapidly, economic growth -
Answers - is slowed by the resulting unpredictability of the future level of prices.
In recent years, wireless cellular telephones have been replacing land-line phone
service. This is an example of - Answers - creative destruction.
Which combination of signals would be a strong indication that Fed policy is too
expansionary and that a shift to a more restrictive policy is in order? - Answers -
Commodity prices are rising, and the dollar is depreciating.
Which of the following is most important if the living standards of people residing in a
country are going to improve? - Answers - growth of per capita GDP
When government debt is financed domestically, future generations of Americans will -
Answers - inherit both higher taxes and additional interest income.
Which of the following is likely to push the federal debt increasingly higher in the coming
decades? - Answers - Increased expenditures on the Social Security and Medicare
programs
Prior to World War II, - Answers - the growth of real GDP was less stable than has been
the case since the war.
Which one of the following is correct about the yield curve during normal times? -
Answers - Interest rates on longer maturity bonds tend to be higher than shorter
maturity bonds.
Those who favor active use of monetary and fiscal policy believe that - Answers -
discretionary changes in macroeconomic policy can help smooth the business cycle of a
market economy.
The privately held government debt is that portion of the national debt that - Answers -
is owed to domestic and foreign investors.
Measured as a share of GDP, the national debt of the United States? - Answers -
Soared to 120 percent of GDP in 2020, higher than at any time in American history.
The sum of all past budget deficits and surpluses of the federal government is the -
Answers - national debt.
Investment in both physical and human capital tends to enhance economic growth
because it generally - Answers - makes it possible for individuals to produce more
goods and services per hour worked
When the money supply is expanding and prices rise rapidly, economic growth -
Answers - is slowed by the resulting unpredictability of the future level of prices.
In recent years, wireless cellular telephones have been replacing land-line phone
service. This is an example of - Answers - creative destruction.
Which combination of signals would be a strong indication that Fed policy is too
expansionary and that a shift to a more restrictive policy is in order? - Answers -
Commodity prices are rising, and the dollar is depreciating.
Which of the following is most important if the living standards of people residing in a
country are going to improve? - Answers - growth of per capita GDP
When government debt is financed domestically, future generations of Americans will -
Answers - inherit both higher taxes and additional interest income.
Which of the following is likely to push the federal debt increasingly higher in the coming
decades? - Answers - Increased expenditures on the Social Security and Medicare
programs
