Test Bank for Principles of Macroeconomics, 10th Edition by N. Gregory Mankiw

TEST BANK FOR
MACROECONOMICS, 10TH
EDITION N. GREGORY MANKIW

,Chapter 1. The Science of Macroeconomics

Macroeconomics does not try to answer the question of:
why some countries experience rapid growth.
what is the rate of return on education.
why some countries have high rates of inflation.
what causes recessions and depressions.


A typical trend during a recession is that:
the unemployment rate falls.
the popularity of the incumbent president rises.
incomes fall.
the inflation rate rises.


Macroeconomics is the study of the:
activities of individual units of the economy.
decisionmaking by households and firms.
economy as a whole.
interaction of firms and households in the marketplace.


The study of the economy as a whole is called:
household economics.
business economics.
microeconomics.
macroeconomics.


The ability of macroeconomists to predict the future course of economic events:
is no better than a meteorologist's ability to predict the next month's weather.
is much better than a meteorologist's ability to predict the next month's weather.
has gotten worse over time.
is less precise than it was in the 1920s.


Which of the combinations listed is not a U.S. president and an important economic
issue of his administration?
President Carter, inflation
President Reagan, budget deficits
President G. H. W. Bush, budget deficits
President Clinton, inflation




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, All of the following are types of macroeconomics data except the: price o
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f a computer.jh jh



growth rate of real GDP. i jh jh jh jh jh



nflation rate. unemploy jh jh



ment rate. jh




All of the following except
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are important macroeconomic variables.
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real GDP jh



the unemployment rate jh jh



the marginal rate of substitution the
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inflation rate
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The total income of everyone in the economy adjusted for the level of base year prices is call
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ed:
a recession. jh jh



an inflation. jh jh



real GDP. jh



a business fluctuation.
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A measure of how fast the general level of prices is rising is called the: gro
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wth rate of real GDP. jh jh jh jh



inflation rate. unem jh jh



ployment rate. mark jh jh



et-clearing rate. jh




The inflation rate is a measure of how fast:
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the total income of the economy is growing. unemplo
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yment in the economy is increasing. jh jh jh jh jh



the general level of prices in the economy is rising. the
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number of jobs in the economy is expanding. jh jh jh jh jh jh jh




Real GDP jh jh over time, and the growth rate of real GDP
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. grows; fluctuates
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is steady; is steady
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grows; is steady jh jh



is steady; fluctuates
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, Two striking features of a graph of U.S. real GDP per capita over the twentieth century are the:
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overall upward trend interrupted by a large downturn due to the economic depre
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ssion in the 1930s. jh jh jh



nearly constant level with a large downturn in the 1930s.
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downward trend in the first half of the century followed by the upward trend in the secondjh jh jh jh jh jh jh jh jh jh jh jh jh jh jh jh jh



half.
constant level in the first half of the century followed by the upward trend in the seco
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nd half. jh




In the U.S. economy today, real GDP per person, compared with its level in 1900, is about
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:
50 percent higher. t jh jh jh



wice as high. thre jh jh j h



e times as high. eigh
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t times as high.
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Recessions are periods when real GDP: incr jh jh jh jh jh jh



eases slowly. jh



increases rapidly. jh jh



decreases mildly. jh jh



decreases severely. jh




Compared with real GDP during a recession, real GDP during a depression: in
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creases more rapidly. jh jh



increases at approximately the same rate. jh jh jh jh jh jh



decreases at approximately the same rate. d jh jh jh jh jh jh



ecreases more severely. jh jh




A severe recession is called a(n):
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depression.
deflation. exogen jh



ous event. jh



market-clearing assumption. jh




The annual inflation rate in the United States averaged: near
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ly zero between 1900 and 1950.
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nearly zero between 1950 and 2000. jh jh jh jh jh



about 10 percent between 1900 and 1950. jh jh jh jh jh jh



about 10 percent between 1950 and 2000. jh jh jh jh jh jh




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