8 Recession is defined as... a) increase in unemployment b) decrease in consumer spending c) two consecutive quarters of negative economic growth d) both A & B 9 Real GDP is adjusted for... a) inflation b) unemployment c) net exports d) foreign investment 10 The labor force participation rate is increasing in Japan because... a) there are fewer unemployed people b) the working age population is increasing c) retirement ages are increasing d) more women are working 11 M1 is a way to measure... a) the level of bank reserves b) a country's money supply c) the level of savings in a country d) a country's economic potential 12 The largest government expenditure for Japan & the US is... a) military / defense b) transfer payments c) education / healthcare d) infrastructure 13 The largest government source of income in Japan & the US is... a) personal income tax b) corporate income tax c) social security contributions d) excise tax / import duties 14 When dealing with deflation, central banks may... a) raise interest rates bj increase reserve requirements c) sell government bonds d) lower interest rates 15 When dealing with a recession, governments may... a) increase spending b) raise taxes c) increase regulations d) decrease spending