This quiz works best with JavaScript enabled. Home > Macroeconomics > Cycles > Business Cycles – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Cycles Quiz 5 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The aggregate production function for real business cycle models is shown as A) Yt = F(Kt, Nt). B) Yt = ztF(Kt-Nt). C) Yt = ztF(Kt, Nt). D) Yt = zt/(Kt, Nt). Show Answer Correct Answer: C) Yt = ztF(Kt, Nt). 2. Many older Americans have trouble finding jobs because of their poor computer skills. What type of unemployment would this be considered? A) Seasonal Unemployment. B) Cyclical Unemployment. C) Frictional Unemployment. D) Structural Unemployment. Show Answer Correct Answer: D) Structural Unemployment. 3. Suppose all financial intermediaries in the financial sector have a liquidity ratio of 25%. If a new deposit of $ 10 000 is made, total deposits can increase by a maximum of:D.$ 50 000 A) $ 40 000. B) $ 25 000. C) $ 10 000. D) $ 50 000. Show Answer Correct Answer: A) $ 40 000. 4. Inflation works to the advantage of ..... A) Creditors. B) Pensioners. C) Insurance policy holders. D) Debtors. Show Answer Correct Answer: D) Debtors. 5. What is the definition for unemployment? A) The market value of all final goods and services produced in a nation during a period of time, usually a year. B) The increase of general prices over time. C) When people do not have jobs and are actively looking for one. D) None of above. Show Answer Correct Answer: C) When people do not have jobs and are actively looking for one. 6. Expectant parents buy supplies for the nursery. Would this be included in GDP? A) Yes-Consumer Spending. B) Yes-Investment. C) No-Intermediate goods. D) No-Non-market activity. Show Answer Correct Answer: A) Yes-Consumer Spending. 7. At the peak phase, businesses will: A) Be worried that they aren't making money. B) Have to sack workers. C) Be so busy that they can't keep up and need more staff. D) Have equipment that is not being used. Show Answer Correct Answer: C) Be so busy that they can't keep up and need more staff. 8. Nominal GDP is not a good measure of economic output. Why? A) Nominal GDP does not adjust for price changes over time. B) Nominal GDP does not capture true economic activity. C) Nominal GDP is not able to be used to make international comparisons. D) None of above. Show Answer Correct Answer: A) Nominal GDP does not adjust for price changes over time. 9. Farm helpers are unemployed when the cropping season is over. A) Frictional. B) Cyclical. C) Structural. D) Seasonal. Show Answer Correct Answer: D) Seasonal. 10. GDP A) Total value of goods produced and services provided in a country during one year. B) Quick wi-fi connection. C) Total value of goods produced and in a country during one year. D) Total value of services provided in a country during one year. Show Answer Correct Answer: A) Total value of goods produced and services provided in a country during one year. 11. What follows the "peak" of a business cycle? A) Recession. B) A "bust". C) The trough. D) None of above. Show Answer Correct Answer: B) A "bust". 12. Taxing & spending to help the economy grow is referred to as A) Expansionary policy. B) Monetary policy. C) Contractionary policy. D) Budget deficit. Show Answer Correct Answer: A) Expansionary policy. 13. What measures a nation's productivity and spending? A) Gross Domestic Product. B) Producer Price Index. C) Consumer Price Index. D) US, Mexico, Canada Agreement. Show Answer Correct Answer: A) Gross Domestic Product. 14. During an economic expansion A) GDP is decreasing and people are losing their jobs. B) GDP is increasing, businesses are expanding, and consumers are spending more. C) GDP is decreasing and businesses are selling less goods. D) None of the above. Show Answer Correct Answer: B) GDP is increasing, businesses are expanding, and consumers are spending more. 15. When a recession is predicted in an economy which of the following occurs? A) Businesses decrease investment. B) Consumers increase spending. C) Businesses increasing hiring. D) Businesses increase investment. Show Answer Correct Answer: A) Businesses decrease investment. 16. In the trough phase, workers will A) Be worried about losing their jobs and are avoiding spending money. B) Be booking their next overseas holiday. C) Be buying a new car. D) Be buying a bigger house. Show Answer Correct Answer: A) Be worried about losing their jobs and are avoiding spending money. 17. During the Spring, Ford Motor Company lays off workers for several weeks as they change over their plants for the new car models. The workers are considered A) Seasonal Unemployment. B) Cyclical Unemployment. C) Frictional Unemployment. D) Structural Unemployment. Show Answer Correct Answer: A) Seasonal Unemployment. 18. Which of the following is not a component of the business cycle? A) Expansion. B) Recession. C) Peak. D) Decline. Show Answer Correct Answer: D) Decline. 19. Declining unemployment rate A) Expansion. B) Peak. C) Contraction. D) Trough. Show Answer Correct Answer: A) Expansion. 20. When the economy is experiencing an unemployment rate between 3-5%, an economist would say the economy is A) At full employment. B) On the cusp of a recession. C) Entering into inflation. D) At an unnatural rate. Show Answer Correct Answer: A) At full employment. ← PreviousNext →Related QuizzesMacroeconomics QuizzesBusiness Cycles Quiz 1Business Cycles Quiz 2Business Cycles Quiz 3Business Cycles Quiz 4Business Cycles Quiz 6Business Cycles Quiz 7Business Cycles Quiz 8Business Cycles Quiz 9Business Cycles Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books