Sophia Macroeconomics Milestone 4, Questions with Complete Answers|2021

1 Which statement below is true of ONLY fiscal policy? A policy typically set by a banking authority Increases the availability of money Uses government expenditures to create demand Used to alter AD CONCEPT Monetary and Fiscal Policy 2 Select the equation below that corresponds to income that can be consumed, saved or paid as taxes. X<M Y=C+S+T+M X=M Y=C+I+G+X CONCEPT Role of International Trade 3 Select the true statement below regarding economic indicators. Trends that describe what has already happened are considered coincident indicators. Economic indicators provide a long term view of the economy. Economic indicators are macroeconomic by their very nature. One single indicator can perfectly describe what is going on in the economy. CONCEPT Understanding Indicators 4 Select the statement below that is FALSE regarding corporate social responsibility. Producing in ways that are sustainable would be an example of corporate social responsibility. Sustainability involves holding the supply chain accountable. Philanthropy by a business always benefits the shareholders of the company. Corporate governance includes oversight of all production and financial operations. CONCEPT Corporate Social Responsibility 5 GDP would be a poor indication of how well a country is doing economically for which of the scenarios below? For a country that has offshore production that is offset by onshore production by foreign nationals For a country that has an equal amount of onshore and offshore production For a country that is producing significantly in other nations, so there is repatriation of profits outside its borders. For a country that has little or no offshore production CONCEPT International Comparisons 6 Which of the following would be true of policies taken during times of BOTH high and low unemployment? Reducing the money supply will reduce inflation. The multiplier effect will magnify the influence of policies. Cutting taxes will cause an increase in GDP. Increasing government spending will stimulate the economy. CONCEPT Monetary and Fiscal Policy 7 Which of the following indicators will most likely increase as a result of the increase in the U.S. poverty rate? Wealth mobility Employment rate Life expectancy Income polarization CONCEPT Global Indicators of Standard of Living 8 Determine which statement below is true of high unemployment. This is when there is the strongest case for comparative advantage. Trade barriers can be beneficial for the domestic economy. It occurs when the economy is at its long run supply capacity. Resources are being overutilized. CONCEPT Analysis Trade Barriers 9 In which of the following circumstances would it be appropriate to use expansionary policy to increase GDP? When resources are being used faster than they can be replaced ..................CONTINUED