This quiz works best with JavaScript enabled. Home > Macroeconomics > Cycles > Business Cycles – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Cycles Quiz 1 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. GDP that is adjusted for inflation A) Real GDP. B) Nominal GDP. C) Price level. D) Net national product. Show Answer Correct Answer: A) Real GDP. 2. Which of the following is a coincident indicator, that helps economists get a better idea of where we are right at this moment in the business cycle? 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. 3. In which part of the GDP calculation does this fit?Australia exported $ 6 billion worth of goods in 2018, but imported $ 10 billion in goods. A) Consumer spending. B) Government spending. C) Investment spending. D) Net exports. Show Answer Correct Answer: D) Net exports. 4. On a business cycle graph, what is the lowest point of the curve where there is the lowest level of GDP? A) Peak. B) Bust/Trough/Slump. C) Recession. D) Recovery. Show Answer Correct Answer: B) Bust/Trough/Slump. 5. Which option presents the business cycle in the correct order A) Trough, contraction, peak, recovery. B) Trough, expansion, peak, contraction. C) Peak, expansion, trough, recovery. D) Peak, contraction, recovery, trough. Show Answer Correct Answer: B) Trough, expansion, peak, contraction. 6. GDP stands for: A) Gross down product. B) Gross domestic product. C) Great dedicated process. D) Great domestic product. Show Answer Correct Answer: B) Gross domestic product. 7. If GDP decreases and is negative, the would mean that A) The economy is not healthy. B) Businesses are selling less. C) There are fewer jobs. D) All of the above. Show Answer Correct Answer: D) All of the above. 8. GDP that is NOT adjusted for inflation A) Real GDP. B) Nominal GDP. C) Price level. D) Net national product. Show Answer Correct Answer: B) Nominal GDP. 9. Why is real GDP more accurate than nominal GDP? A) It's adjusted for price changes. B) It's adjusted for depreciation. C) It includes unpaid and paid work. D) It includes unrecorded business. Show Answer Correct Answer: A) It's adjusted for price changes. 10. On a business cycle graph, what is the phase called when there is an upward slope and GDP is increasing? A) Recession. B) Shock. C) Bust. D) Recovery. Show Answer Correct Answer: D) Recovery. 11. Which of the following statements would be classified as "full employment'? A) Everyone who wants to work has a job. B) Approximately 95% of people have a job. C) People who have been hunting for a job for a long time. D) Everyone who wants to work have full time jobs. Show Answer Correct Answer: B) Approximately 95% of people have a job. 12. Read the following headline and choose the condition that correspond with the business cycle.Interest rates at a low of 2% cause consumers to take out loans and buy homes. A) Peak. B) Contractionary. C) Trough. D) Growth. Show Answer Correct Answer: D) Growth. 13. Which phase of the business cycle is missing:Recovery, Boom, Recession A) Peak. B) Shock. C) Bust. D) Upward Slope. Show Answer Correct Answer: C) Bust. 14. What is the difference between real GDP per capita and real GDP? A) Real GDP per capita takes into account population. B) Real GDP per capita takes into unemployment. C) Real GDP per capita takes into exchange rates. D) Real GDP per capita takes into account savings. Show Answer Correct Answer: A) Real GDP per capita takes into account population. 15. Which is a shortcoming of using GDP as a measure of the economy? A) GDP isn't reliable. B) GDP is commuted in dollars. C) GDP always includes inflation. D) GDP does not include work done at home such as house renovations. Show Answer Correct Answer: D) GDP does not include work done at home such as house renovations. 16. A literary editor leaves her job in New York to look for a new job in San Francisco. A) Frictional. B) Cyclical. C) Structural. D) Not counted. Show Answer Correct Answer: A) Frictional. 17. If GDP falls for at least 2 Quarters, it is considered what stage of the business cycle? A) Expansion. B) Recession. C) Prosperity. D) Recovery. Show Answer Correct Answer: B) Recession. 18. A deposit made into a bank is considered ..... of that bank. A) Capital. B) An asset. C) An investment. D) A liability. Show Answer Correct Answer: D) A liability. 19. Which of the following would count towards GDP? A) A previously owned car. B) Stocks and bonds. C) Items produced by a US company in another country. D) A newly built home. Show Answer Correct Answer: D) A newly built home. 20. When is the highest point of real GDP happen? A) Contraction. B) Expansion. C) Peak. D) Trough. Show Answer Correct Answer: C) Peak. Next →Related QuizzesMacroeconomics QuizzesBusiness Cycles Quiz 2Business Cycles Quiz 3Business Cycles Quiz 4Business Cycles Quiz 5Business Cycles Quiz 6Business Cycles Quiz 7Business Cycles Quiz 8Business Cycles Quiz 9Business Cycles Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books