1) What is the "store of value" function of money?

A)the quality of money not to be hoarded because of its commodity value

B)the function of money to be widely accepted in the exchange for goods and services

C)a common measurement of the relative value of different goods and services

D)the ability of money to hold value over time

2) Wilson has been retrenched by his shipbuilding plant as a machine has been invented that can perform his job more efficiently.Because he has very specialised skills that are no longer in demand, Wilson faces great difficulty in finding another job.Wilson's unemployment is best classified as

A)cyclical.frictional.

B)frictional.

C)seasonal.

D)structural.

3) For barter to occur, traders must have a

A)unit of account.

B)central banking facility.

C)medium of exchange.

D)coincidence of wants.

4) Aysha, a housewife, decides to re-enter the labour market since all her children are now grown-up.However she is unable to find a full-time job, so she accepts a part-time job.She is classified as

A)voluntarily unemployed.

B)a discouraged worker.

C)underemployed.

D)economically inactive.

5) A budget surplus is

A)G < T

B)G > T

C)G = T

D)G = T + TP

6) Which of the following can cause the official unemployment rate to overstate the true unemployment situation?

A)Unreported employment in the underground economy

B)The exclusion of the underemployed

C)The exclusion of discouraged workers

D)All of the above

7) As the marginal propensity to consume (MPC) decreases, the spending multiplier

A)becomes undefinable.

B)decreases.

C)increases.

D)remains constant.

8) The Consumer Price Index measures changes over time in the prices of a fixed market basket of

A)resources purchased by a typical producer.

B)necessities purchased by a typical consumer.

C)goods and services purchased by a typical family.

D)goods and services produced by a typical economy.

9) Contractionary fiscal policy is deliberate government action to influence aggregate demand and the level of real GDP through

A)decreasing government spending or increasing taxes.

B)encouraging business to expand or contract investment.

C)expanding and contracting the money supply.

D)regulating net exports.

10) A government spending and taxation policy to achieve macroeconomic goals is known as

A)a balanced budget.

B)countercyclical policy.

C)fiscal policy.

D)monetary policy.