#1
What is the definition of macroeconomic equilibrium?
When the government budget is balanced
When aggregate demand equals aggregate supply
When unemployment rate equals zero
When inflation rate equals GDP growth rate
#2
Which of the following is a component of aggregate demand?
Government spending
Foreign direct investment
Household savings
Imports
#3
In the AD-AS model, what causes a movement along the aggregate demand curve?
Changes in price level
Changes in technology
Changes in government spending
Changes in aggregate supply
#4
Which of the following is a tool of fiscal policy used to combat recession?
Increasing interest rates
Decreasing government spending
Increasing taxes
Decreasing reserve requirements
#5
Which of the following is a component of the aggregate supply curve?
Government spending
Consumer spending
Wage rate
Interest rate
#6
What is the role of the central bank in controlling the money supply?
Setting fiscal policy
Issuing currency
Conducting open market operations
Regulating government spending
#7
What happens to the equilibrium level of output and price level if there is an increase in aggregate demand?
Output increases, price level decreases
Output decreases, price level increases
Output increases, price level increases
Output decreases, price level decreases
#8
What is the Keynesian perspective on achieving macroeconomic equilibrium?
Through controlling money supply
Through fiscal policy interventions
Through supply-side policies
Through controlling interest rates
#9
What is the Phillips curve relationship between unemployment and inflation?
Inverse relationship
Direct relationship
No relationship
Indirect relationship
#10
What is the concept of the natural rate of unemployment?
The rate of unemployment when the economy is at full employment
The rate of unemployment caused by cyclical factors
The rate of unemployment caused by frictional factors
The rate of unemployment caused by structural factors
#11
What is the formula for calculating the unemployment rate?
Number of unemployed / Labor force
Number of unemployed / Total population
Number of employed / Labor force
Number of employed / Total population
#12
Which of the following is a characteristic of the long-run aggregate supply curve?
It is vertical
It is horizontal
It is upward sloping
It is downward sloping
#13
According to the monetarist perspective, what is the primary cause of inflation?
Government budget deficit
Excessive aggregate demand
Cost-push factors
Wage-price spiral
#14
What is the crowding-out effect in macroeconomics?
Increase in private investment due to government borrowing
Decrease in private investment due to government borrowing
Increase in government spending due to private investment
Decrease in government spending due to private investment
#15
What does the term 'stagflation' refer to?
High inflation and high unemployment
Low inflation and low unemployment
High inflation and low unemployment
Low inflation and high unemployment
#16
What is the concept of the liquidity trap in macroeconomics?
A situation where interest rates are so high that saving is discouraged
A situation where monetary policy becomes ineffective due to very low interest rates
A situation where banks have excess reserves but are reluctant to lend
A situation where fiscal policy becomes ineffective due to high government debt