1
Copyright © 2026 Pearson Canada Inc.
cn cn cn cn cn
,TEST BANK FOR
cn cn
Macroeconomics, Canadian Edition, 10th edition Andrew B. Abel Ben S. Bernanke Dean Crousho cn cn cn cn cn cn cn cn cn cn cn cn
re Ronald D. Kneebone Trevor Tombe
cn cn cn cn cn
Chapter 1-14 cn
Chapter 1 cn Introduction to Macroeconomics cn cn
1.1 What Macroeconomics Is About cn cn cn
1) Which of the following is a topic of macroeconomics?
cn cn cn cn cn cn cn cn
A) why nations have different rates of growth
cn cn cn cn cn cn
B) what causes inflation and what can be done about it
cn cn cn cn cn cn cn cn cn
C) why unemployment periodically reaches very high levels
cn cn cn cn cn cn
D) all of the above cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
2) The two major reasons for the tremendous growth in output in the Canadian economy over the l
cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn
ast 150 years are
cn cn cn
A) population growth and budget deficit. cn cn cn cn
B) population growth and increased productivity. cn cn cn cn
C) low unemployment and budget surplus.
cn cn cn cn
D) low budget deficit and low trade deficits.
cn cn cn cn cn cn cn
Answer: B c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
3) The main reason Canada has such a high standard of living is
cn cn cn cn cn cn cn cn cn cn cn
A) low unemployment. cn
B) high average labour productivity. cn cn cn
C) low inflation. cn
D) low government budget deficits.
cn cn cn cn
Answer: B c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
4) Average labour productivity is cn cn cn
A) the amount of workers per machine.
cn cn cn cn cn
B) the amount of machines per worker.
cn cn cn cn cn
C) the ratio of employed to unemployed workers.
cn cn cn cn cn cn
D) the amount of output per worker.
cn cn cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
2
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
,5) In analyzing macroeconomic data during the past year, you have discovered that average labour p
cn cn cn cn cn cn cn cn cn cn cn cn cn cn
roductivity fell, but total output increased. What was most likely to have caused this?
cn cn cn cn cn cn cn cn cn cn cn cn cn
A) Government deficit was reduced. cn cn cn
B) The capital/output ratio probably rose.
cn cn cn cn
C) There was an increase in labour input.
cn cn cn cn cn cn
D) Unemployment probably increased. cn cn cn
Answer: C c n
Diff: 3 cnType: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
6) The business cycle describes the
cn cn cn cn
A) progression of an industry's structure from monopoly to perfect competition.
cn cn cn cn cn cn cn cn cn
B) progression of an industry's structure from perfect competition to monopoly.
cn cn cn cn cn cn cn cn cn
C) expansion and contraction of an individual industry within the economy.
cn cn cn cn cn cn cn cn cn
D) expansion and contraction of economic activity in the economy as a whole.
cn cn cn cn cn cn cn cn cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
7) Which of the following best describes the potential impact of economic growth on different
cn cn cn cn cn cn cn cn cn cn cn cn cn cn
groups in society? cn cn
A) Economic growth ensures that every group benefits equally.
cn cn cn cn cn cn cn
B) Economic growth can improve living standards, but some groups may experience negative
cn cn cn cn cn cn cn cn cn cn cn cn
consequences.
C) Economic growth is driven by equal resource distribution among all groups.
cn cn cn cn cn cn cn cn cn cn
D) Economic growth is only beneficial to those directly involved in production.
cn cn cn cn cn cn cn cn cn cn cn
Answer: B c n
Diff: 1 cnType: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
8) When national output declines, the economy is said to be in
cn cn cn cn cn cn cn cn cn cn
A) an expansion.
cn
B) a deflation.
cn
C) a recovery.
cn
D) a recession.
cn
Answer: D c n c n
Diff: 1 cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
9) During recessions, the unemployment rate
cn and output cn cn cn cn cn cn .
A) rises; falls cn
B) rises; rises cn
C) falls; rises cn
D) falls; falls cn c
Answer: A
n c n
Diff: 1 cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
3
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
, 10) The unemployment rate is the
cn cn cn cn
A) number of unemployed divided by the number of employed.
cn cn cn cn cn cn cn cn
B) number of employed divided by the number of unemployed.
cn cn cn cn cn cn cn cn
C) number of unemployed divided by the labour force.
cn cn cn cn cn cn cn
D) labour force divided by the number of unemployed.
cn cn cn cn cn cn cn cn
Answer: C c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
11) Which of the following is a potential consequence of barriers to interprovincial trade within a
cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn
country?
A) They can reduce overall economic productivity.
cn cn cn cn cn
B) They have no significant impact on productivity.
cn cn cn cn cn cn
C) They increase opportunities for international trade.
cn cn cn cn cn
D) They improve internal market efficiency by limiting competition.
cn cn cn cn cn cn cn cn
Answer: A c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
12) A country is said to be experiencing inflation when
cn cn cn cn cn cn cn cn
A) prices of most goods and services are rising over time.
cn cn cn cn cn cn cn cn cn
B) prices of most goods and services are falling over time.
cn cn cn cn cn cn cn cn cn
C) total output is rising over time.
cn cn cn cn cn
D) total output is falling over time.
cn cn cn cn cn cn
Answer: A c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
13) A country is said to be experiencing deflation when
cn cn cn cn cn cn cn cn
A) prices of most goods and services are rising over time.
cn cn cn cn cn cn cn cn cn
B) prices of most goods and services are falling over time.
cn cn cn cn cn cn cn cn cn
C) total output is rising over time.
cn cn cn cn cn
D) total output is falling over time.
cn cn cn cn cn cn
Answer: B c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
14) An open economy is a national economy that
cn cn cn cn cn cn cn
A) has good relations with its neighbouring countries.
cn cn cn cn cn cn
B) has a stock market that is open to traders from anywhere in the world.
cn cn cn cn cn cn cn cn cn cn cn cn cn
C) has extensive trading and financial relationships with other national economies.
cn cn cn cn cn cn cn cn cn
D) has established diplomatic relations with most other nations.
cn cn cn cn cn cn cn cn
Answer: C c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
4
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
Copyright © 2026 Pearson Canada Inc.
cn cn cn cn cn
,TEST BANK FOR
cn cn
Macroeconomics, Canadian Edition, 10th edition Andrew B. Abel Ben S. Bernanke Dean Crousho cn cn cn cn cn cn cn cn cn cn cn cn
re Ronald D. Kneebone Trevor Tombe
cn cn cn cn cn
Chapter 1-14 cn
Chapter 1 cn Introduction to Macroeconomics cn cn
1.1 What Macroeconomics Is About cn cn cn
1) Which of the following is a topic of macroeconomics?
cn cn cn cn cn cn cn cn
A) why nations have different rates of growth
cn cn cn cn cn cn
B) what causes inflation and what can be done about it
cn cn cn cn cn cn cn cn cn
C) why unemployment periodically reaches very high levels
cn cn cn cn cn cn
D) all of the above cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
2) The two major reasons for the tremendous growth in output in the Canadian economy over the l
cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn
ast 150 years are
cn cn cn
A) population growth and budget deficit. cn cn cn cn
B) population growth and increased productivity. cn cn cn cn
C) low unemployment and budget surplus.
cn cn cn cn
D) low budget deficit and low trade deficits.
cn cn cn cn cn cn cn
Answer: B c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
3) The main reason Canada has such a high standard of living is
cn cn cn cn cn cn cn cn cn cn cn
A) low unemployment. cn
B) high average labour productivity. cn cn cn
C) low inflation. cn
D) low government budget deficits.
cn cn cn cn
Answer: B c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
4) Average labour productivity is cn cn cn
A) the amount of workers per machine.
cn cn cn cn cn
B) the amount of machines per worker.
cn cn cn cn cn
C) the ratio of employed to unemployed workers.
cn cn cn cn cn cn
D) the amount of output per worker.
cn cn cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
2
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
,5) In analyzing macroeconomic data during the past year, you have discovered that average labour p
cn cn cn cn cn cn cn cn cn cn cn cn cn cn
roductivity fell, but total output increased. What was most likely to have caused this?
cn cn cn cn cn cn cn cn cn cn cn cn cn
A) Government deficit was reduced. cn cn cn
B) The capital/output ratio probably rose.
cn cn cn cn
C) There was an increase in labour input.
cn cn cn cn cn cn
D) Unemployment probably increased. cn cn cn
Answer: C c n
Diff: 3 cnType: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
6) The business cycle describes the
cn cn cn cn
A) progression of an industry's structure from monopoly to perfect competition.
cn cn cn cn cn cn cn cn cn
B) progression of an industry's structure from perfect competition to monopoly.
cn cn cn cn cn cn cn cn cn
C) expansion and contraction of an individual industry within the economy.
cn cn cn cn cn cn cn cn cn
D) expansion and contraction of economic activity in the economy as a whole.
cn cn cn cn cn cn cn cn cn cn cn cn
Answer: D c n
Diff: 1 Type: MC
cn cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
7) Which of the following best describes the potential impact of economic growth on different
cn cn cn cn cn cn cn cn cn cn cn cn cn cn
groups in society? cn cn
A) Economic growth ensures that every group benefits equally.
cn cn cn cn cn cn cn
B) Economic growth can improve living standards, but some groups may experience negative
cn cn cn cn cn cn cn cn cn cn cn cn
consequences.
C) Economic growth is driven by equal resource distribution among all groups.
cn cn cn cn cn cn cn cn cn cn
D) Economic growth is only beneficial to those directly involved in production.
cn cn cn cn cn cn cn cn cn cn cn
Answer: B c n
Diff: 1 cnType: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
8) When national output declines, the economy is said to be in
cn cn cn cn cn cn cn cn cn cn
A) an expansion.
cn
B) a deflation.
cn
C) a recovery.
cn
D) a recession.
cn
Answer: D c n c n
Diff: 1 cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
9) During recessions, the unemployment rate
cn and output cn cn cn cn cn cn .
A) rises; falls cn
B) rises; rises cn
C) falls; rises cn
D) falls; falls cn c
Answer: A
n c n
Diff: 1 cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
3
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
, 10) The unemployment rate is the
cn cn cn cn
A) number of unemployed divided by the number of employed.
cn cn cn cn cn cn cn cn
B) number of employed divided by the number of unemployed.
cn cn cn cn cn cn cn cn
C) number of unemployed divided by the labour force.
cn cn cn cn cn cn cn
D) labour force divided by the number of unemployed.
cn cn cn cn cn cn cn cn
Answer: C c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
11) Which of the following is a potential consequence of barriers to interprovincial trade within a
cn cn cn cn cn cn cn cn cn cn cn cn cn cn cn
country?
A) They can reduce overall economic productivity.
cn cn cn cn cn
B) They have no significant impact on productivity.
cn cn cn cn cn cn
C) They increase opportunities for international trade.
cn cn cn cn cn
D) They improve internal market efficiency by limiting competition.
cn cn cn cn cn cn cn cn
Answer: A c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
12) A country is said to be experiencing inflation when
cn cn cn cn cn cn cn cn
A) prices of most goods and services are rising over time.
cn cn cn cn cn cn cn cn cn
B) prices of most goods and services are falling over time.
cn cn cn cn cn cn cn cn cn
C) total output is rising over time.
cn cn cn cn cn
D) total output is falling over time.
cn cn cn cn cn cn
Answer: A c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
13) A country is said to be experiencing deflation when
cn cn cn cn cn cn cn cn
A) prices of most goods and services are rising over time.
cn cn cn cn cn cn cn cn cn
B) prices of most goods and services are falling over time.
cn cn cn cn cn cn cn cn cn
C) total output is rising over time.
cn cn cn cn cn
D) total output is falling over time.
cn cn cn cn cn cn
Answer: B c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
14) An open economy is a national economy that
cn cn cn cn cn cn cn
A) has good relations with its neighbouring countries.
cn cn cn cn cn cn
B) has a stock market that is open to traders from anywhere in the world.
cn cn cn cn cn cn cn cn cn cn cn cn cn
C) has extensive trading and financial relationships with other national economies.
cn cn cn cn cn cn cn cn cn
D) has established diplomatic relations with most other nations.
cn cn cn cn cn cn cn cn
Answer: C c n
Diff: 1
cn Type: MC cn
LO: 1.1: Summarize the primary issues addressed in macroeconomics.
c n c n cn cn cn cn cn cn cn
4
Copyright © 2026 Pearson Canada Inc. cn cn cn cn cn
