MACROECONOMICS FINAL
EXAM
140+ (Latest 2025-2026 Edition) 100% Verified Q&A + Answer Key
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,Question 1
Which of the following is the best definition of a recession?
Correct Answer
A period of significant, widespread decline in real income and employment lasting more than a few
months.
Question 2
Investment is:
Correct Answer
the purchase of new capital goods.
Question 3
An economy with production function Y = F(K) = that has 400 units of capital will produce _____ units of
output.
Correct Answer
20
Question 4
When an economy is adjusting to a recent reduction in the money supply, what is a likely consequence?
Correct Answer
Unemployment is high.
,Question 5
In the basic model with an AD and LRAS curve only, if spending growth is 7% and the Solow growth rate
rises from 0% to 3%, then inflation will:
Correct Answer
decrease from 7% to 4%.
Question 6
To fight a recession, the federal government can:
Correct Answer
increase its spending.
Question 7
A customer at a fast-food restaurant may choose to order a burger for $4.00 and fries for $1.50, or order a
value meal (that includes the burger, fries, and a drink) for $6.00. What is the marginal cost of the drink if
the customer orders the value meal?
Correct Answer
$0.50
Question 8
A shortage of a good occurs when:
Correct Answer
the quantity supplied is less than the quantity demanded.
, Question 9
Suppose you deposit $1,000 in your checking account. If the reserve ratio is 10%, how much of your
deposit can the bank loan out?
Correct Answer
$900
Question 10
Scientists discover that an asteroid is headed toward Earth and the force of its impact, expected in a
matter of weeks, will wipe out all human life. What will happen to the demand for cancer screenings?
Correct Answer
It would decrease because people wouldn't care anymore if they had cancer.
Question 11
The demand curve for oil shows:
Correct Answer
the quantity demanded of oil at different oil prices.
Question 12
Trading in the market for loanable funds determines the equilibrium
Correct Answer
level of savings, amount of borrowing, and interest rate.
EXAM
140+ (Latest 2025-2026 Edition) 100% Verified Q&A + Answer Key
Solutions
100% Guarantee Pass
✓ This Exam contains: Macroeconomics Final Exam
✓ 100% Accurate Questions and Answers
✓ 100% Guarantee Pass - Verified by Experts
✓ Each Question Includes The Correct Answer
✓ Expert-Verified
,Question 1
Which of the following is the best definition of a recession?
Correct Answer
A period of significant, widespread decline in real income and employment lasting more than a few
months.
Question 2
Investment is:
Correct Answer
the purchase of new capital goods.
Question 3
An economy with production function Y = F(K) = that has 400 units of capital will produce _____ units of
output.
Correct Answer
20
Question 4
When an economy is adjusting to a recent reduction in the money supply, what is a likely consequence?
Correct Answer
Unemployment is high.
,Question 5
In the basic model with an AD and LRAS curve only, if spending growth is 7% and the Solow growth rate
rises from 0% to 3%, then inflation will:
Correct Answer
decrease from 7% to 4%.
Question 6
To fight a recession, the federal government can:
Correct Answer
increase its spending.
Question 7
A customer at a fast-food restaurant may choose to order a burger for $4.00 and fries for $1.50, or order a
value meal (that includes the burger, fries, and a drink) for $6.00. What is the marginal cost of the drink if
the customer orders the value meal?
Correct Answer
$0.50
Question 8
A shortage of a good occurs when:
Correct Answer
the quantity supplied is less than the quantity demanded.
, Question 9
Suppose you deposit $1,000 in your checking account. If the reserve ratio is 10%, how much of your
deposit can the bank loan out?
Correct Answer
$900
Question 10
Scientists discover that an asteroid is headed toward Earth and the force of its impact, expected in a
matter of weeks, will wipe out all human life. What will happen to the demand for cancer screenings?
Correct Answer
It would decrease because people wouldn't care anymore if they had cancer.
Question 11
The demand curve for oil shows:
Correct Answer
the quantity demanded of oil at different oil prices.
Question 12
Trading in the market for loanable funds determines the equilibrium
Correct Answer
level of savings, amount of borrowing, and interest rate.
