Complete - Test Bank
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Macroeconomics, 11th Edition.
LE
By Andrew Abel, Ben Bernanke, Dean Croushore.
ST
All Chapters 1-15, Latest Edition, Rationales Provided.
BE
BESTLEC
,Table of Contents
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Part 1: Introduction
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1. Introduction to Macroeconomics
2. The Measurement and Structure of the National Economy
Part 2: Long-Run Economic Performance
ST
3. Productivity, Output, and Employment
4. Consumption, Saving, and Investment
5. Saving and Investment in the Open Economy
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6. Long-Run Economic Growth
7. The Asset Market, Money, and Prices
Part 3: Business Cycles and Macroeconomic Policy
8. Business Cycles
9. The IS–LM/AD–AS Model: A General Framework for Macroeconomic Analysis
10. Classical Business Cycle Analysis: Market-Clearing Macroeconomics
11. Keynesianism: The Macroeconomics of Wage and Price Rigidity
Part 4: Macroeconomic Policy: Its Environment and Institutions
12. Unemployment and Inflation
13. Exchange Rates, Business Cycles, and Macroeconomic Policy in the Open Economy
14. Monetary Policy and the Federal Reserve System
15. Government Spending and Its Financing
BESTLEC
,Chapter 1: Introduction to Macroeconomics.
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1. Which of the following best describes the scope of macroeconomics?
LE
A) It studies individual consumers and firms.
B) It focuses on the behavior of large corporations only.
ST
C) It examines national economic aggregates and overall economic performance.
D) It only deals with the study of inflation.
Answer: C
BE
Explanation: Microeconomics studies individual agents, whereas macroeconomics looks at
aggregates (GDP, inflation, unemployment, etc.) at the national or global level.
2. A primary concern of macroeconomics is:
A) Determination of a firm’s profit-maximizing output.
B) Understanding how individual preferences affect consumption of specific goods.
C) Analysis of the overall price level and national output.
D) Market structure and firm behavior in oligopolies.
Answer: C
Explanation: While microeconomics focuses on individual markets, macroeconomics deals with
broad indicators such as aggregate price levels (inflation) and national output (GDP).
3. Which of the following is a key macroeconomic goal?
A) Minimizing the costs of production for individual firms.
B) Achieving high and stable rates of economic growth.
C) Maximizing the utility of individual consumers.
D) Managing the internal organization of firms.
Answer: B
BESTLEC
, Explanation: Major macroeconomic policy goals typically include stable growth, low
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unemployment, and stable prices.
LE
4. The difference between ―positive and ―normative economics is best described as:
ST
A) Positive economics deals with value judgments; normative economics deals with facts.
B) Positive economics deals with ―what is; normative economics deals with ―what ought
to be.
C)
BE
They are the same thing in macroeconomics.
D) Normative economics is always wrong.
Answer: B
Explanation: Positive economic analyzes facts and cause-effect relationships; normative
economics incorporates value judgments and policy recommendations.
5. Macroeconomists rely on models primarily to:
A) Predict precise future economic events without error.
B) Simplify complex real-world phenomena into core relationships.
C) Eliminate the role of assumptions in economics.
D) Ensure that economic policies never fail.
Answer: B
Explanation: Economic models are abstractions designed to highlight the most important
relationships and simplify the complex real-world economy.
6. An exogenous variable in a macroeconomic model is:
A) Determined within the model.
B) Determined by forces outside the model.
BESTLEC
C
Macroeconomics, 11th Edition.
LE
By Andrew Abel, Ben Bernanke, Dean Croushore.
ST
All Chapters 1-15, Latest Edition, Rationales Provided.
BE
BESTLEC
,Table of Contents
C
Part 1: Introduction
LE
1. Introduction to Macroeconomics
2. The Measurement and Structure of the National Economy
Part 2: Long-Run Economic Performance
ST
3. Productivity, Output, and Employment
4. Consumption, Saving, and Investment
5. Saving and Investment in the Open Economy
BE
6. Long-Run Economic Growth
7. The Asset Market, Money, and Prices
Part 3: Business Cycles and Macroeconomic Policy
8. Business Cycles
9. The IS–LM/AD–AS Model: A General Framework for Macroeconomic Analysis
10. Classical Business Cycle Analysis: Market-Clearing Macroeconomics
11. Keynesianism: The Macroeconomics of Wage and Price Rigidity
Part 4: Macroeconomic Policy: Its Environment and Institutions
12. Unemployment and Inflation
13. Exchange Rates, Business Cycles, and Macroeconomic Policy in the Open Economy
14. Monetary Policy and the Federal Reserve System
15. Government Spending and Its Financing
BESTLEC
,Chapter 1: Introduction to Macroeconomics.
C
1. Which of the following best describes the scope of macroeconomics?
LE
A) It studies individual consumers and firms.
B) It focuses on the behavior of large corporations only.
ST
C) It examines national economic aggregates and overall economic performance.
D) It only deals with the study of inflation.
Answer: C
BE
Explanation: Microeconomics studies individual agents, whereas macroeconomics looks at
aggregates (GDP, inflation, unemployment, etc.) at the national or global level.
2. A primary concern of macroeconomics is:
A) Determination of a firm’s profit-maximizing output.
B) Understanding how individual preferences affect consumption of specific goods.
C) Analysis of the overall price level and national output.
D) Market structure and firm behavior in oligopolies.
Answer: C
Explanation: While microeconomics focuses on individual markets, macroeconomics deals with
broad indicators such as aggregate price levels (inflation) and national output (GDP).
3. Which of the following is a key macroeconomic goal?
A) Minimizing the costs of production for individual firms.
B) Achieving high and stable rates of economic growth.
C) Maximizing the utility of individual consumers.
D) Managing the internal organization of firms.
Answer: B
BESTLEC
, Explanation: Major macroeconomic policy goals typically include stable growth, low
C
unemployment, and stable prices.
LE
4. The difference between ―positive and ―normative economics is best described as:
ST
A) Positive economics deals with value judgments; normative economics deals with facts.
B) Positive economics deals with ―what is; normative economics deals with ―what ought
to be.
C)
BE
They are the same thing in macroeconomics.
D) Normative economics is always wrong.
Answer: B
Explanation: Positive economic analyzes facts and cause-effect relationships; normative
economics incorporates value judgments and policy recommendations.
5. Macroeconomists rely on models primarily to:
A) Predict precise future economic events without error.
B) Simplify complex real-world phenomena into core relationships.
C) Eliminate the role of assumptions in economics.
D) Ensure that economic policies never fail.
Answer: B
Explanation: Economic models are abstractions designed to highlight the most important
relationships and simplify the complex real-world economy.
6. An exogenous variable in a macroeconomic model is:
A) Determined within the model.
B) Determined by forces outside the model.
BESTLEC
