Question 22

1. The consumer price index is a measure of

a) the average of the prices paid by urban consumers for a fixed basket of consumer goods and services.

b) the consumer prices paid by average households for a fixed basket of goods and services.

c) the average of the prices paid by all consumers for a fixed basket of consumer goods and services.

D) the lowest prices paid by all consumers for a fixed basket of consumer goods and services.

E) the lowest prices paid by urban consumers for a fixed basket of consumer goods and services.

Question 23

1. If outlays exceed revenues, the government's budget balance is ________, and the government has a budget ________.

a) positive; surplus

b) positive; deficit

c)zero; surplus

d) negative; deficit

e) negative; surplus

Question 24

1. Suppose we observe a rise in the price of good Aand an increase in the quantity of good Abought and sold. Which one of the following is a likely explanation?

a)The demand forAdecreased.

b) The supply ofAincreased.

c) The demand forAincreased.

d)The law of demand is violated.

e)The supply ofAdecreased.

Question 25

1. In a country with a working-age population of 22 million, 18 million are employed, 2 million are unemployed, and 1 million of the employed are working part-time, half of whom wish to work full-time. The unemployment rate is

a)18.2 percent.

b) 9.1 percent.

c) 2 percent.

d) 11.1 percent.

e) 10 percent.

Question 26

1. According to ________, the business cycle is the result of aggregate demand growing at a fluctuating rate.

a) only the Keynesian and monetarist cycle theories

b)the Keynesian cycle theory only

c) the Keynesian, monetarist, and new classical cycle theories

d) the Keynesian, monetarist, and real business cycle theories

e) real business cycle theory

Question 27

1. If Sam is producing at a point inside his production possibilities frontier, then he

a) is unaffected by costs and technology.

b) is fully using all his resources and allocating his resources to their best use.

c )can increase production of both goods with zero opportunity cost.

d) has a high opportunity cost of moving from this point.

e) must be doing the best he can with limited resources.

Question 28

1. If the Bank of Canada buys government securities, all of the following happensexcept

a) net exports increase.

b)the quantity of money increases.

c)the supply of loanable funds increases.

d)bank reserves increase.

e)the bank rate rises.

Question 29

1. The world goes into an expansion. This event

a)decreases Canada's aggregate demand.

b) increases Canada's short-run aggregate supply.

c) decreases Canada's aggregate demand and decreases Canada's short-run aggregate supply.

d) increases Canada's long-run aggregate supply.

e) increases Canada's aggregate demand.

Question 30

1. The operating band is

a) the target overnight interest rate plus or minus 25 basis points.

b)the target inflation rate plus or minus a quarter of a percentage point.

C) the range between the lending rate and the borrowing rate.

d) the interest rate that is established through an open market operation.

e) a half percentage point range in the target inflation rate.

Question 32

1. Trade is organized using the social institutions of all of the followingexcept

a) property rights.

b)labour unions

c) markets.

d) money.

e)firms.

Question 33

1. IfAand Bare complements in production and the price of Afalls, the supply of B

a) increases, and the price ofBfalls.

b) does not change.

c)decreases, and the price ofBfalls.

d) increases, and the price ofBrises.

e) decreases, and the price ofBrises.

Question 34

1. Which one of the following people is cyclically unemployed?

a) a student who recently graduated and is looking for work

b) an office worker who has lost her job because of a general slowdown in economic activity

c) a Nova Scotia fishery worker who is searching for a better job closer to home

d) a Saskatchewan welder who lost her job when her company relocated to B. C. and is currently looking for a job

E a steel worker who is laid off but who expects to be called back soon

Question 35

1. We observe an increase in the price level and a decrease in real GDP. Which of the following is a possible explanation?

a) an increase in expected future profits

b)an increase in factor prices

c) an increase in the quantity of money

d) an increase in the quantity of capital

e) an increase in expected future income

Question 36

1. In 2016, Northland had real GDP of $4.21 billion and a population of 2.98 million. In 2017, real GDP was $4.59 billion and population was 2.97 million. Northland's real GDP per person in 2017 was

a) $1,413.

b) $1,545.

c) $6,470.

d) $64.70.

e) $1.55.

Question 37

1. Which of the following is the best definition of economics?

a) the study of how consumers and producers meet each other in the market

b) the study of how consumers spend their income

c) the study of how individuals, businesses, governments, and entire societies make choices as they cope with scarcity and the incentives that influence and reconcile those choices

d) the study of how producers decide what inputs to hire and what outputs to produce

ethe study of how a provincial government allocates tax dollars

Question 38

1. What is the overnight loans rate?

a) the interest rate that the Bank of Canada pays when it buys securities from chartered banks

b) the percentage change in the volume of loans that take place overnight

c) the volume of loans that take place during the night

d) the interest rate that the Bank of Canada charges chartered banks

e) the interest rate on loans that the big banks make to each other