1. Microeconomics focuses on the decisions and actions of ________.

Group of answer choices

consumers

businesses

government

consumers, businesses, and government

2.Demand refers to the quantity of a good or service that market participants ________ during a given time period.

Group of answer choices

are willing to purchase at various prices

are willing and able to purchase at various prices

hope to purchase at various prices

are willing to purchase at any price

3.The relationship between the price of an item and the demand for it is depicted in the demand curve. Which of the following is not likely to cause a shift in the demand curve?

Group of answer choices

Growth of the economy

Buyers' tastes and preferences

Prices of comparable goods

Changes in consumers' income

4.If the demand for a good increased, the quantities of that good purchased at every price level would be ________.

Group of answer choices

higher

lower

unchanged

undetermined

5.Economists distinguish between a change in quantity demanded and a change in demand. What does movement downward to the right along the demand curve indicate?

Group of answer choices

An increase in the quantity demanded

A decrease in the quantity demanded

An increase in demand

A decrease in demand

6.The supply curve depicts the relationship between the price of a good and the quantity supplied of that good. The relationship between the two is ________.

Group of answer choices

indirect

direct

unrelated

indeterminable

7.The point at which the supply and demand curves intersect is the equilibrium price. If the number of goods demanded at a particular price is lower than the number supplied, the market will experience a(n) ________ of the good.

Group of answer choices

shortage

equilibrium

surplus

deficit

8.The equilibrium price of a good will ________ if the quantity demanded falls.

Group of answer choices

decrease

increase

remain unchanged

be indeterminable

9. A new celebrity endorsement, a rise in consumers' disposable income, a decrease in the price of a product, and a price rise for comparable products are all factors that might cause what?

Group of answer choices

An increase in the demand for the product

An increase in the supply of the product

A lower equilibrium price for the product

A decrease in the demand for the product

10. Unemployment is an important topic studied in macroeconomics. Which of the following is not among the criteria to qualify as unemployed?

Group of answer choices

Not declining job opportunities

Being jobless

Actively seeking work

Being capable of working

11.To calculate CPI, a basket of goods is chosen randomly, and the prices of the goods are compared over relevant time periods. Why do the goods in the basket sometimes change?

Group of answer choices

The NBER requires regular rotation of the goods in the basket.

They need to reflect changes in typical consumer purchases.

Different parties measure inflation differently.

Not all prices can be ascertained.

12.Inflation is measured in many ways because the goods measured differ to varying degrees. What is the best measure of inflation for ordinary consumers?

Group of answer choices

The GDP deflator

The consumer price index

The producer price index

The Billion Prices Project

13.Macroeconomics includes the study of inflation, or the overall rise in price levels. Why does inflation erode the purchasing power of consumers?

Group of answer choices

Purchasing power means the ability to buy goods and services.

Prices of goods and services change in tandem with inflation.

Higher prices at the same income make goods less affordable.

Consumers decrease discretionary spending if inflation is high.

14.Gross domestic product (GDP), or the total value of goods and services produced within the borders of a country during a defined time period, is commonly divided into four sectors. Which of the following is not one of those four sectors?

Group of answer choices

Consumption

Military

Business

Investment

15.Real GDP is equal to nominal GDP minus ________.

Group of answer choices

services

imports

inflation

consumption

16.An automobile is manufactured in Japan and purchased in Chicago. Why would this transaction not be counted as part of the US GDP?

Group of answer choices

Exported goods are not counted in GDP.

Cross-border trade is excluded from GDP.

Foreign imports are subject to foreign exchange adjustment.

Only goods produced within the United States are included in US GDP.

17.The business cycle is the natural market dynamic observed where an economy alternates between growth and contraction. What is the sequence of one full business cycle?

Group of answer choices

Trough, peak, expansion, contraction, trough

Trough, expansion, peak, contraction, trough

Peak, trough, contraction, expansion, peak

Peak, contraction, trough, expansion, peak

18.Over the past approximately 100 years, a complete business cycle has averaged how many years?

Group of answer choices

Less than one year

One to three years

4.5 years

10 years

19.The nominal interest rate is the one we see and use every day. How would you derive the real interest rate?

Group of answer choices

Add the inflation rate to the nominal rate.

Subtract inflation from the nominal rate.

Calculate inflation for the next period.

Use the prevailing prime rate.

20. The real interest rate is actually a theoretical idea. A customer cannot go to a bank and request to pay the real rate for a car loan or receive the real rate on a certificate of deposit. Why, then, is the real interest rate useful?

Group of answer choices

It reveals inflation expectations.

It influences purchasing power.

It identifies changes in the rate not caused by inflation.

It is more easily understood.

21.Most foreign exchange rates are determined by current market conditions. When Currency A becomes more expensive to buy with Currency B, this means that Currency A has ________.

Group of answer choices

depreciated

appreciated

reached equilibrium

lost value

22.In a graph of supply and demand, the intersection of the supply and demand curves for a good represents the equilibrium price for that good.

Group of answer choices

True

False

23.A retired person would be considered unemployed.

Group of answer choices

True

False

24.The foreign exchange rate for an immediate exchange of currencies is called a spot exchange rate.

Group of answer choices

True

False