This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Cycles > Business Cycles – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Cycles Quiz 2 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. GDP, or gross domestic product, measures ..... A) The value of all final goods and services produced. B) An increase in the general price level. C) The percentage of people looking for work that can't find it. D) The economic freedom an economy offers. Show Answer Correct Answer: A) The value of all final goods and services produced. 2. If GDP of the economy grows, what is MOST LIKELY to happen to investment by a business in the economy? A) Increase. B) Decrease. C) Stay the same. D) None of above. Show Answer Correct Answer: A) Increase. 3. The Gross Domestic Product measured in current prices describes what? A) Current GDP. B) Real GDP. C) Nominal GDP. D) Total GDP. Show Answer Correct Answer: C) Nominal GDP. 4. This stage of the business life cycle is generally the longest that a business will experience, and reflects dominating presence. A) Start-up. B) Seed. C) Growth. D) Maturity. Show Answer Correct Answer: D) Maturity. 5. If you graph Real GDP, then you have created ..... A) An Inflation Index. B) Labor Output Graph. C) The Business Cycle. D) An economic forecast. Show Answer Correct Answer: C) The Business Cycle. 6. In January of 2017 when President Obama left office and began looking for another job. he was considered A) Cyclical Unemployment. B) Frictional Unemployment. C) Seasonal Unemployment. D) Structural Unemployment. Show Answer Correct Answer: B) Frictional Unemployment. 7. The real business cycle theory is most closely related to A) Keynesian theory. B) Monetarist theory. C) The classical model. D) All of the above. Show Answer Correct Answer: C) The classical model. 8. When individuals lose jobs due to fall in aggregate demand, often during an economic recession. A) Frictional Unemployment. B) Cyclical Unemployment. C) Seasonal Unemployment. D) Structural Unemployment. Show Answer Correct Answer: B) Cyclical Unemployment. 9. Which of the following is a lagging indicator that changes after real GDP and helps economists get a clearer sense of exactly when a recession or expansion might have ended? A) Personal income. B) The ratio of how much consumers owe to measures of personal income. C) Stock prices. D) None of above. Show Answer Correct Answer: C) Stock prices. 10. In the circular flow model, what do individuals SELL to businesses A) Resources. B) D Goods. C) Money. D) Services. Show Answer Correct Answer: A) Resources. 11. What type of GDP is calculated is adjusted for inflation? A) Nominal GDP. B) Real GDP. C) GDP per capita. D) None of above. Show Answer Correct Answer: B) Real GDP. 12. "Business investment in capital goods (machinery for production) rises." The headline above affects which economic indicator the most? A) Gross Domestic Product (GDP). B) Unemployment. C) Inflation. D) Consumer Price Index. Show Answer Correct Answer: A) Gross Domestic Product (GDP). 13. Stimulative policy is indicative of the ..... stage in the business cycle. A) Recession. B) Late. C) Mid. D) Early. Show Answer Correct Answer: D) Early. 14. What problem might policymakers be trying to address MOST when they increase funding for training programs covering skills such as computer repair, programming, and networking? A) Seasonal unemployment. B) Structural unemployment. C) Cyclical unemployment. D) Frictional unemployment. Show Answer Correct Answer: B) Structural unemployment. 15. In the trough phase, businesses will A) Be making lots of money. B) Be buying lots of new equipment. C) Be sacking staff, cutting costs and avoiding spending money. D) Be hiring more workers. Show Answer Correct Answer: C) Be sacking staff, cutting costs and avoiding spending money. 16. What do the households provide businesses? A) Labour. B) Wages. C) Resources. D) Goods and services. Show Answer Correct Answer: C) Resources. 17. GDP will begin to decline at- A) The peak. B) The trough. C) The contractionary phase. D) None of above. Show Answer Correct Answer: A) The peak. 18. Period of economic growth as measured by a rise in real GDP A) Trough. B) Expansion. C) Contraction. D) Peak. Show Answer Correct Answer: B) Expansion. 19. Tom was fired for failing a drug test and has been in a rehab facility for drug addiction for 3 months A) Unemployed. B) Labor force. C) Not in the labor force. D) Employed. Show Answer Correct Answer: C) Not in the labor force. 20. Lauren coaches softball and gets paid in cash each week. Is this included in GDP? A) No-Purely financial transaction. B) Yes-Investment. C) No-Underground Economy. D) Yes-Consumer Spending. Show Answer Correct Answer: C) No-Underground Economy. 21. What occurs at a trough? A) Low unemployment, low inflation. B) High unemployment, high inflation. C) Low unemployment, high inflation. D) High unemployment, low inflation. Show Answer Correct Answer: D) High unemployment, low inflation. 22. During which stage can a business adjust its ideas in response to feedback to ensure it is effectively meeting expectations of key stakeholders. A) Maturity. B) Post-maturity. C) Startup. D) Seed. Show Answer Correct Answer: C) Startup. 23. Sizzler is an example of a business in which stage of the life cycle? A) Maturity. B) Growth. C) Seed. D) Post-Maturity. Show Answer Correct Answer: D) Post-Maturity. 24. What will people looking for work during the contraction phase of the business cycle find? A) Business are hiring a large number of workers. B) It is easy to find work. C) They will find jobs plentiful. D) It is more difficult to find work. Show Answer Correct Answer: D) It is more difficult to find work. 25. Which of the following is NOT an indicator of the business cycle? A) Labor force. B) Wages. C) Labor costs and productivity. D) Birth rate. Show Answer Correct Answer: D) Birth rate. 26. What is the difference between real GDP and nominal GDP? A) Real GDP takes into account unemployment. B) Real GDP takes into account inflation. C) Real GDP takes into account population. D) Real GDP takes into account exchange rates. Show Answer Correct Answer: B) Real GDP takes into account inflation. 27. Unemployment measures ..... A) The value of all final goods and services produced. B) An increase in the general price level. C) The percentage of people looking for work that can't find it. D) The economic freedom an economy offers. Show Answer Correct Answer: C) The percentage of people looking for work that can't find it. 28. What can the government do to give a boost to a slowing economy? A) Raise taxes. B) Lower taxes. C) Increase interest rates. D) None of above. Show Answer Correct Answer: B) Lower taxes. 29. GDP divided by ..... = GDP per capita A) Wealth. B) Population. C) Production. D) Income. Show Answer Correct Answer: B) Population. 30. GDP stands for which of the following? A) Gross Domestic Product. B) Gross Demand Product. C) General Domestic Product. D) General Demand Product. Show Answer Correct Answer: A) Gross Domestic Product. ← PreviousNext →Related QuizzesMacroeconomics QuizzesEconomics QuizzesBusiness Cycles Quiz 1Business Cycles Quiz 3Business Cycles Quiz 4Business Cycles Quiz 5Business Cycles Quiz 6Business Cycles Quiz 7Business Cycles Quiz 8Business Cycles Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books