NETAASSESSMENT n
Test Bank n
to accompany
n
Test Bank prepared by
n n n
n Constantin Colonescu n
MacEwan University
n n
,NETA Assessment: Test Bank to accompany Principles of Macroeconomics,
n n n n n n n n
Sixth Canadian Edition n n
By N. Gregory Mankiw / Ronald D. Kneebone / Kenneth J. McKenzie
n n n n n n n n n n n
Test Bank prepared by Constantin Colonescu, MacEwan University
n n n n n n n
NETA copy editor: Frances Robinson
n n n n
Available on Instructor’s Resource CD ISBN . 0-17-655440-8
n n n n n n n
COPYRIGHT ©2014 by Nelson Education Ltd. Nelson is a registered trademark used herein under licence. All rights
n n n n n n n n n n n n n n n n
reserved.
n
For more information contact Nelson, 1120 Birchmount Road, Toronto, Ontario M1K 5G4. Or you can visit our
n n n n n n n n n n n n n n n n
nInternet site at www.nelson.com. n n n
ALL RIGHTS RESERVED. No part of this work covered by the copyright hereon may be reproduced or used in any form
n n n n n n n n n n n n n n n n n n n n
or by any means—graphic, electronic, or mechanical, including photocopying, recording, taping, web distribution
n n n n n n n n n n n n n
or information storage and retrieval systems—without the written permission of the publisher
n n n n n n n n n n n n
ii
, TABLE OF CONTENTS n n
Part 1 Introduction
n n
Chapter 1 Ten Principles of Economics
n n n n n 1-1
Chapter 2 Thinking Like an Economist
n n n n n 2-1
Chapter 3 Interdependence and the Gains from Trade
n n n n n n n 3-1
Part 2 Supply And Demand: How Markets Work
n n n n n n n
Chapter 4 The Market Forces of Supply and Demand
n n n n n n n n 4-1
Part 3 The Data of Macroeconomics
n n n n n
Chapter 5 Measuring a Nation’s Income
n n n n n 5-1
Chapter 6 Measuring the Cost of Living
n n n n n n 6-1
Part 4 The Real Economy in the Long Run
n n n n n n n n
Chapter 7 Production and Growth
n n n n 7-1
Chapter 8 Saving, Investment, and the Financial System
n n n n n n n 8-1
Chapter 9 Unemployment and Its Natural Rate
n n n n n n 9-1
Part 5 Money And Prices in the Long Run
n n n n n n n n
Chapter 10 The Monetary System
n n n n 10-1
Chapter 11 Money Growth and Inflation
n n n n n 11-1
Part 6 The Macroeconomics of Open Economies
n n n n n n
Chapter 12 Open-Economy Macroeconomics: Basic Concepts
n n n n n 12-1
Chapter 13 A Macroeconomic Theory of the Small Open Economy
n n n n n n n n n 13-1
Part 7 Short-Run Economic Fluctuations
n n n n
Chapter 14 Aggregate Demand and Aggregate Supply
n n n n n n 14-1
Chapter 15 The Influence of Monetary and Fiscal Policy on Aggregate Demand
n n n n n n n n n n n 15-1
Chapter 16 The Short-Run Tradeoff between Inflation and Unemployment
n n n n n n n n 16-1
Part 8 Final Thoughts
n n n
Chapter 17 Five Debates over Macroeconomic Policy
n n n n n n 17-1
iii
, PREFACE
In most post-secondary courses, a large percentage of student assessment is based on multiple-
n n n n n n n n n n n n n
nchoice testing. Many instructors use multiple-choice reluctantly, believing that it is a
n n n n n n n n n n n
nmethodology best used for testing what a student remembers rather than what she or he has n n n n n n n n n n n n n n n
nlearned.
Nelson Education Ltd. understands that a good quality multiple-choice test bank can provide
n n n n n n n n n n n n
nthe means to measure higher-level thinking skills as well as recall. Recognizing the
n n n n n n n n n n n n
nimportance of multiple-choice testing in today’s classroom, we have created NETA—the
n n n n n n n n n n
nNelson Education Teaching Advantage program—to ensure the value of our high quality test
n n n n n n n n n n n n
nbanks.
The NETA program was created in partnership with David DiBattista, a 3M National Teaching
n n n n n n n n n n n n n
nFellow, professor of psychology at Brock University, and researcher in the area of multiple-
n n n n n n n n n n n n n
nchoice testing. NETA ensures that subject-matter experts who author test banks have had
n n n n n n n n n n n n
ntraining in two areas: avoiding common errors in test construction, and developing multiple-
n n n n n n n n n n n n
nchoice test questions that “get beyond remembering” to assess higher-level thinking.
n n n n n n n n n n
All NETA test banks include David DiBattista’s guide for instructors, “Multiple Choice Tests:
n n n n n n n n n n n n
nGetting Beyond Remembering.” This guide has been designed to assist you in using Nelson
n n n n n n n n n n n n n
ntest banks to achieve your desired outcomes in your course.
n n n n n n n n n
The Test Bank for Principles of Macroeconomics, Sixth Canadian Edition has been revised for
n n n n n n n n n n n n n
nCanadian students by Constantin Colonescu, MacEwan University. The multiple-choice
n n n n n n n n
nquestions were written and edited to conform to NETA guidelines, which emphasize the
n n n n n n n n n n n n
ndevelopment of higher-order thinking and the effective construction of questions. NETA n n n n n n n n n n
nprinciples of question construction help eliminate ambiguity, arguable answers, guesswork,
n n n n n n n n n
nand unconscious cues to test-savvy students, resulting in a test that accurately reflects student
n n n n n n n n n n n n n
nunderstanding. The Test Bank offers over 3510 questions, including about 2822 multiple n n n n n n n n n n n
nchoice, about 362 true/false, about 162 problems, and about 164 short answer questions.
n n n n n n n n n n n n
In addition to providing a variety of questions related to each chapter objective, this test bank
n n n n n n n n n n n n n n n
nalso employs a series of tags that can help design effective, balanced tests by the measure of
n n n n n n n n n n n n n n n n
ncourse outcomes. All of the tags are included with the question in the test bank. These tags
n n n n n n n n n n n n n n n n
ninclude:
ANS: The correct answer. (Suggested answers are provided for the short answer questions.)
n n n n n n n n n n n n
PTS: The number of points an instructor can assign for each question. The default is 1
n n n n n n n n n n n n n n n
point. n
4
Test Bank n
to accompany
n
Test Bank prepared by
n n n
n Constantin Colonescu n
MacEwan University
n n
,NETA Assessment: Test Bank to accompany Principles of Macroeconomics,
n n n n n n n n
Sixth Canadian Edition n n
By N. Gregory Mankiw / Ronald D. Kneebone / Kenneth J. McKenzie
n n n n n n n n n n n
Test Bank prepared by Constantin Colonescu, MacEwan University
n n n n n n n
NETA copy editor: Frances Robinson
n n n n
Available on Instructor’s Resource CD ISBN . 0-17-655440-8
n n n n n n n
COPYRIGHT ©2014 by Nelson Education Ltd. Nelson is a registered trademark used herein under licence. All rights
n n n n n n n n n n n n n n n n
reserved.
n
For more information contact Nelson, 1120 Birchmount Road, Toronto, Ontario M1K 5G4. Or you can visit our
n n n n n n n n n n n n n n n n
nInternet site at www.nelson.com. n n n
ALL RIGHTS RESERVED. No part of this work covered by the copyright hereon may be reproduced or used in any form
n n n n n n n n n n n n n n n n n n n n
or by any means—graphic, electronic, or mechanical, including photocopying, recording, taping, web distribution
n n n n n n n n n n n n n
or information storage and retrieval systems—without the written permission of the publisher
n n n n n n n n n n n n
ii
, TABLE OF CONTENTS n n
Part 1 Introduction
n n
Chapter 1 Ten Principles of Economics
n n n n n 1-1
Chapter 2 Thinking Like an Economist
n n n n n 2-1
Chapter 3 Interdependence and the Gains from Trade
n n n n n n n 3-1
Part 2 Supply And Demand: How Markets Work
n n n n n n n
Chapter 4 The Market Forces of Supply and Demand
n n n n n n n n 4-1
Part 3 The Data of Macroeconomics
n n n n n
Chapter 5 Measuring a Nation’s Income
n n n n n 5-1
Chapter 6 Measuring the Cost of Living
n n n n n n 6-1
Part 4 The Real Economy in the Long Run
n n n n n n n n
Chapter 7 Production and Growth
n n n n 7-1
Chapter 8 Saving, Investment, and the Financial System
n n n n n n n 8-1
Chapter 9 Unemployment and Its Natural Rate
n n n n n n 9-1
Part 5 Money And Prices in the Long Run
n n n n n n n n
Chapter 10 The Monetary System
n n n n 10-1
Chapter 11 Money Growth and Inflation
n n n n n 11-1
Part 6 The Macroeconomics of Open Economies
n n n n n n
Chapter 12 Open-Economy Macroeconomics: Basic Concepts
n n n n n 12-1
Chapter 13 A Macroeconomic Theory of the Small Open Economy
n n n n n n n n n 13-1
Part 7 Short-Run Economic Fluctuations
n n n n
Chapter 14 Aggregate Demand and Aggregate Supply
n n n n n n 14-1
Chapter 15 The Influence of Monetary and Fiscal Policy on Aggregate Demand
n n n n n n n n n n n 15-1
Chapter 16 The Short-Run Tradeoff between Inflation and Unemployment
n n n n n n n n 16-1
Part 8 Final Thoughts
n n n
Chapter 17 Five Debates over Macroeconomic Policy
n n n n n n 17-1
iii
, PREFACE
In most post-secondary courses, a large percentage of student assessment is based on multiple-
n n n n n n n n n n n n n
nchoice testing. Many instructors use multiple-choice reluctantly, believing that it is a
n n n n n n n n n n n
nmethodology best used for testing what a student remembers rather than what she or he has n n n n n n n n n n n n n n n
nlearned.
Nelson Education Ltd. understands that a good quality multiple-choice test bank can provide
n n n n n n n n n n n n
nthe means to measure higher-level thinking skills as well as recall. Recognizing the
n n n n n n n n n n n n
nimportance of multiple-choice testing in today’s classroom, we have created NETA—the
n n n n n n n n n n
nNelson Education Teaching Advantage program—to ensure the value of our high quality test
n n n n n n n n n n n n
nbanks.
The NETA program was created in partnership with David DiBattista, a 3M National Teaching
n n n n n n n n n n n n n
nFellow, professor of psychology at Brock University, and researcher in the area of multiple-
n n n n n n n n n n n n n
nchoice testing. NETA ensures that subject-matter experts who author test banks have had
n n n n n n n n n n n n
ntraining in two areas: avoiding common errors in test construction, and developing multiple-
n n n n n n n n n n n n
nchoice test questions that “get beyond remembering” to assess higher-level thinking.
n n n n n n n n n n
All NETA test banks include David DiBattista’s guide for instructors, “Multiple Choice Tests:
n n n n n n n n n n n n
nGetting Beyond Remembering.” This guide has been designed to assist you in using Nelson
n n n n n n n n n n n n n
ntest banks to achieve your desired outcomes in your course.
n n n n n n n n n
The Test Bank for Principles of Macroeconomics, Sixth Canadian Edition has been revised for
n n n n n n n n n n n n n
nCanadian students by Constantin Colonescu, MacEwan University. The multiple-choice
n n n n n n n n
nquestions were written and edited to conform to NETA guidelines, which emphasize the
n n n n n n n n n n n n
ndevelopment of higher-order thinking and the effective construction of questions. NETA n n n n n n n n n n
nprinciples of question construction help eliminate ambiguity, arguable answers, guesswork,
n n n n n n n n n
nand unconscious cues to test-savvy students, resulting in a test that accurately reflects student
n n n n n n n n n n n n n
nunderstanding. The Test Bank offers over 3510 questions, including about 2822 multiple n n n n n n n n n n n
nchoice, about 362 true/false, about 162 problems, and about 164 short answer questions.
n n n n n n n n n n n n
In addition to providing a variety of questions related to each chapter objective, this test bank
n n n n n n n n n n n n n n n
nalso employs a series of tags that can help design effective, balanced tests by the measure of
n n n n n n n n n n n n n n n n
ncourse outcomes. All of the tags are included with the question in the test bank. These tags
n n n n n n n n n n n n n n n n
ninclude:
ANS: The correct answer. (Suggested answers are provided for the short answer questions.)
n n n n n n n n n n n n
PTS: The number of points an instructor can assign for each question. The default is 1
n n n n n n n n n n n n n n n
point. n
4
