Eco372 week 1 knowledge seek
1.
The two frameworks conventional economists generally use to analyze macroeconomic issues are
• A.
the inflation and the unemployment frameworks
• B.
the short-run and the long-run frameworks
• C.
the business cycle and the growth cycle frameworks
• D.
the stagnationist and the Post-Keynesian frameworks
2.
The relationship between real and nominal interest rate can be expressed by
• A.
real interest rate = nominal interest rate + inflation
• B.
real interest rate = inflation – nominal interest rate
• C.
real interest rate = nominal interest rate – inflation
• D.
The real interest rate cannot be calculated.
3.
Which of the following economic activities would be included in the U.S. domestic gross product (GDP)?
• A.
Illegal drug sales
• B.
Pure services, such as haircuts
• C.
Illegal prostitution
• D.
Work performed and paid for in cash to avoid income tax
4.
Cyclical unemployment is defined as unemployment that results from
• A.
fluctuations in economic activity
• B.
structural changes in the economy
• C.
changes in technology
• D.
the aging of the population
5.
The longest business cycle expansion in U.S. history occurred in the 10 years from
• A.
1919 until 1929
• B.
1938 until 1948
• C.
1959 until 1969
• D.
1991 until 2001
6.
Economics is the study of how
• A.
governments allocate resources in the face of constraints
• B.
government policies can be used to meet individuals’ wants and desires
• C.
human beings coordinate their wants and desires
• D.
scarce resources are allocated to their most productive uses
Concept: LAW OF DEMAND
7.
Given that diesel cars get much better gas mileage than the typical car, an increase in the price of gasoline would be expected to
• A.
increase the demand for diesel cars
• B.
decrease the demand for gasoline
• C.
decrease the demand for diesel cars
• D.
increase the demand for gasoline