# Macroeconomics. as opposed to microeconomics. includes the study of what determines the level of

1.Macroeconomics, as opposed to microeconomics, includes the study of what determines the level of

A. employment in a specific industry

B.employment in the economy

C.output of a specific firm

D.output of a specific industry.

2.The unemployment rate is an important economic statistic that can tell us about the health of the economy. If the unemployment rate turns out to be high or higher than anticipated, we would expect

A.it is more likely that an incumbent president will be re-elected.

B.that stock prices are more likely to fall.

C.that jobs are less difficult to find.

D.that investors will be more optimistic about the economy.

3.Which of the following statements is always true about the U.S. economy?

A.Each year, many new jobs are created, but few existing jobs are destroyed, and the unemployed find jobs quickly.

B.Each year, few new jobs are created, but few existing jobs are destroyed, keeping unemployment low.

C.Each year, many new jobs are created and many existing jobs are destroyed.

D.Each year few jobs are created, and therefore it takes the unemployed a long time to find a new job.

4.In examining the national income accounts of the closed economy of the country X you see that this year it had taxes of $100 billion, transfers of$40 billion, and government purchases of goods and services of $80 billion. You also notice that last year it had taxes of 120 billion, private saving of$50 billion, and investment of $80 billion. Thus, in ___ year, the country X have a budget ____ of _____ billion? A.this year; deficit;$20

B.this year; surplus; $20 C. last year; deficit;$30

D.last year; surplus; $40 5.We can illustrate the economic growth model using the per-worker production function, which is the relationship between ______, holding the level of technology constant. A.real GDP per capita and capital per capita B.real GDP per hour worked and capital per hour worked C.nominal GDP per capita and capital per capita D.nominal GDP per hour worked and capital per hour worked 6.Why has productivity growth in the U.S. been more rapid than in the other industrialized countries? A.Because of the greater flexibility of U.S. labor markets and the greater efficiency of the financial system. B.Because the U.S. government has more restrictive but also more effective regulations that makes the labor and output markets more efficient. C.Because the opportunity cost of being unemployed is lower in the U.S. than in other countries. D.All of the above. 7.The slope of the consumption function is equal to A.the change in consumption divided by the change in disposable income. B.the change in consumption divided by the change in personal income. C,the change in disposable income divided by the change in consumption. D.the change in national income divided by the change in consumption. ## Answer Answer 1. b. employment in the econony Reason- Macroeconomics deals with issues concerning the whole economy rather than a specific firm or industry. Employment in the economy is an issue for the whole economy rather than output in a firm or an industry. Answer 2. the stock prices are likely to fall. Reason- when unemployment rises, output falls and inflation rate rises. So the economic growth is going down. So the stock prices fall. Jobs are difficult to find. Investors are pessimistic about the economy. Answer 3. Each year many new jobs are created and many jobs are destroyed. Reason- If there is one thing about the economy that is always tru ,it is that jobs will always be created and destroyed . It. depends upon the technology, the economic condition etc. Answer 4. this year, deficit ,$20.

Reason- Surplus= Expenditure- revenue= 80+40-100=\$20