BMAL 590 MACROECONOMICS
EXAM QUESTIONS WITH
CORRECT ANSWERS
Which one of the following is not a cost voluntary unemployment? - Answer-mental
stress that the unemployment may undergo.
Cyclical unemployment is the: - Answer-unemployment that occurs during the
recessionary and depressionary parts of the business cycle.
The natural rate of unemployment can be described as: - Answer-the sum of frictional
unemployment and structural unemployment.
According to Keynesian economist, those who are not working: - Answer-are not able to
find a job at the current wage rate.
The index most often used to measure inflation is the: - Answer-consumer price index
Assume you at the owner of a firm manufacturing bicycles. Assume also that wage
inflation is higher than price inflation. Would you be worried? - Answer-Yes, because the
cost of your input is growing faster than the revenue obtained from the output.
In the long run, Phillips curve will be vertical and the natural rate of unemployment if: -
Answer-the long run aggregate supply curve is vertical at potential GDP.
If input prices adjusted very slowly to output prices, the Phillips curve would be: -
Answer-horizontal or nearly horizontal
Suppose the inflationary expectation in an economy increase, the short run Phillips
curve would: - Answer-Shift to the right
Suppose the government reduces the corporate tax rate to encourage businesses to
invest in development, this would be an example of: - Answer-an expansionary supply
side policy
Which one of the following does real GDP measure? - Answer-a country's physical
output
Suppose an economy registers and increase in nominal GDP of 5%. This may be
explained by: - Answer-a decrease in real GDP by 5% and an increase in prices by
10%.
EXAM QUESTIONS WITH
CORRECT ANSWERS
Which one of the following is not a cost voluntary unemployment? - Answer-mental
stress that the unemployment may undergo.
Cyclical unemployment is the: - Answer-unemployment that occurs during the
recessionary and depressionary parts of the business cycle.
The natural rate of unemployment can be described as: - Answer-the sum of frictional
unemployment and structural unemployment.
According to Keynesian economist, those who are not working: - Answer-are not able to
find a job at the current wage rate.
The index most often used to measure inflation is the: - Answer-consumer price index
Assume you at the owner of a firm manufacturing bicycles. Assume also that wage
inflation is higher than price inflation. Would you be worried? - Answer-Yes, because the
cost of your input is growing faster than the revenue obtained from the output.
In the long run, Phillips curve will be vertical and the natural rate of unemployment if: -
Answer-the long run aggregate supply curve is vertical at potential GDP.
If input prices adjusted very slowly to output prices, the Phillips curve would be: -
Answer-horizontal or nearly horizontal
Suppose the inflationary expectation in an economy increase, the short run Phillips
curve would: - Answer-Shift to the right
Suppose the government reduces the corporate tax rate to encourage businesses to
invest in development, this would be an example of: - Answer-an expansionary supply
side policy
Which one of the following does real GDP measure? - Answer-a country's physical
output
Suppose an economy registers and increase in nominal GDP of 5%. This may be
explained by: - Answer-a decrease in real GDP by 5% and an increase in prices by
10%.
