This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Cycles > Business Cycles – Quiz 6 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Cycles Quiz 6 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A period of macroeconomic expansion or growth, followed by a period of contraction, or decline. A) Circular Flow. B) GDP. C) Equilibrium. D) Business Cycle. Show Answer Correct Answer: D) Business Cycle. 2. Which of the following is NOT a challenge of the growth stage? A) Overextending resources of the business in order to expand. B) New competitors. C) Cost-cutting. D) Deciding a re-positioning strategy. Show Answer Correct Answer: D) Deciding a re-positioning strategy. 3. When the unemployment rate is relatively high, A) The growth in real GDP is low. B) The growth in real GDP is high. C) The amount of physical capital available has decreased. D) Inflation is also relatively high. Show Answer Correct Answer: A) The growth in real GDP is low. 4. The federal government's overall approach to spending and taxes is called A) Physical Policy. B) Fiscal Policy. C) Money. D) Monetary Policy. Show Answer Correct Answer: B) Fiscal Policy. 5. Logan loses his job cooking pizza when a robot can do it faster and at a lower expense. Which type of unemployment is he experiencing? A) Cyclical. B) Frictional. C) Structural. D) Seasonal. Show Answer Correct Answer: C) Structural. 6. If GDP of the economy falls and decreases, what is MOST LIKELY to happen to production and recruitment at a business in the economy? A) Increase. B) Decrease. C) Stay the same. D) None of above. Show Answer Correct Answer: B) Decrease. 7. In which stage of the business life cycle could it be necessary to bring in external professions to help analyse, evaluate or review the business? A) Seed. B) Growth. C) Post-matuirty. D) Maturity. Show Answer Correct Answer: C) Post-matuirty. 8. One of the most effective ways for a business to stay competitive in the maturity stage is to? A) Cut costs. B) Open more business locations. C) Lay off staff. D) Create more products. Show Answer Correct Answer: A) Cut costs. 9. GDP is calculated by A) Adding up the cost of goods used in producing the item. B) Subtracting all costs from total revenue. C) Adding consumption + investment +government spending+ (exports sold-imports bought). D) None of above. Show Answer Correct Answer: C) Adding consumption + investment +government spending+ (exports sold-imports bought). 10. Economists try to predict changes in the business cycle using economic indicators. Which of the following is a leading indicator that shows where we're heading in the near future? 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. 11. Michael Kors hires designers to come up with new product lines. Is this included in GDP? A) No-purely financial transaction. B) Yes-Consumer Spending. C) No-Black Market. D) Yes-Investments. Show Answer Correct Answer: D) Yes-Investments. 12. The BEST example of structural unemployment in an economy is someone A) Between jobs or entering the workforce. B) Out of work due to a seasonal downturn in business. C) Out of work due to a change in the business cycle. D) Whose job skills do not match the economy's needs. Show Answer Correct Answer: D) Whose job skills do not match the economy's needs. 13. Which of the following do households provide businesses? A) Labor. B) Taxes. C) Goods and Services. D) Final Products. Show Answer Correct Answer: A) Labor. 14. A trend line will show- A) An increase in Real GDP over time. B) Only economic recessions. C) Only economic expansions. D) None of above. Show Answer Correct Answer: A) An increase in Real GDP over time. 15. Fiscal Policy is concerned with A) Government Spending and taxation. B) Consumer spending and productivity. C) Government spending and the money supply. D) Taxation and inflation. Show Answer Correct Answer: A) Government Spending and taxation. 16. A man with a PhD working as a waiter at Olive Garden about 20-25 hours a week. A) Not in the Labor Force. B) Not Applicable / Not Counted. C) Employed. D) Unemployed. Show Answer Correct Answer: C) Employed. 17. ..... occurs when people are in between jobs, entering and reentering the labor force. A) Technological unemployment. B) Seasonal unemployment. C) Cyclical unemployment. D) Frictional unemployment. Show Answer Correct Answer: D) Frictional unemployment. 18. In the circular flow model, the product market describes ..... A) Stores that sell goods and services to households. B) The government paying for public goods. C) Households selling their labor to businesses. D) Households receive income from businesses. Show Answer Correct Answer: A) Stores that sell goods and services to households. 19. At what point on the business cycle would you have the lowest unemployment rate A) Bust. B) Recession. C) Recovery. D) Peak. Show Answer Correct Answer: D) Peak. 20. How many phases make up the business cycle? A) 6. B) 2. C) 8. D) 4. Show Answer Correct Answer: D) 4. 21. To be considered a recession, a contraction must last for a period of A) 5 years. B) 2 years. C) 1 quarter. D) 2 consecutive quarters. Show Answer Correct Answer: D) 2 consecutive quarters. 22. Which would most likely occur during a period of recession? A) Real gross domestic output falls. B) Unemployment rate falls. C) Production increase. D) Personal income increases. Show Answer Correct Answer: A) Real gross domestic output falls. 23. What is a recession? A) Decrease in GDP for 6 months+. B) Decrease in GDP. C) Increase in GDP. D) GDP stays same for 1 year. Show Answer Correct Answer: A) Decrease in GDP for 6 months+. 24. An economic contraction is synonymous with A) A peak. B) A recession. C) Full employment. D) Economic growth. Show Answer Correct Answer: B) A recession. 25. Which of the following expenditures would not be included in GDP? A) Purchase of a new lawnmower. B) Purchase of a silver cup previously sold new in 1950. C) Purchase of a ticket to the latest movie. D) All of these would be counted in GDP. Show Answer Correct Answer: B) Purchase of a silver cup previously sold new in 1950. 26. Labor productivity is measured as the A) Dollar value of output per unit of labor. B) Hourly wage rate divided by output per labor-hour. C) Dollar value of inputs per unit of output. D) Output per labor-hour. Show Answer Correct Answer: D) Output per labor-hour. 27. The business cycle is made up of how many phases? A) 4. B) 5. C) 2. D) 3. Show Answer Correct Answer: A) 4. 28. In the contraction phase, workers will notice that A) Things are still very busy. B) There is plenty of overtime. C) Overtime has dropped-off, and they are not as busy as before. D) The boss gives everyone a pay rise. Show Answer Correct Answer: C) Overtime has dropped-off, and they are not as busy as before. 29. This type of inflation occurs when the demand for products is greater that the supply of products. A) Cost push inflation. B) Demand pull inflation. C) Divisional inflation. D) Structural inflation. Show Answer Correct Answer: B) Demand pull inflation. 30. The lowest point of output in a recession, before a recovery begins is called A) Slump. B) Growth. C) Recession. D) Boom. Show Answer Correct Answer: A) Slump. ← PreviousNext →Related QuizzesMacroeconomics QuizzesEconomics QuizzesBusiness Cycles Quiz 1Business Cycles Quiz 2Business Cycles Quiz 3Business Cycles Quiz 4Business Cycles Quiz 5Business Cycles Quiz 7Business Cycles Quiz 8Business Cycles Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books