Economics Micro & Macro (CliffsAP)

46. Which of the following best describes comparative
    advantage?
    A. When one country can produce a good or
    service at a cheaper price than another
    B. When one country is less capable than
    another at producing a good or service
    C. When both countries decide to specialize in
    the production of one good
    D. When one country can produce a good or
    service at a lower opportunity cost than
    another country
    E. When neither country can specialize because
    of trade barriers


47. When inflation is unanticipated, which of the
    following groups would benefit from it: savers,
    borrowers, or lenders?
    A. Savers only
    B. Borrowers only
    C. Lenders only
    D. Savers and borrowers only
    E. Savers and lenders only


48. What is the result if there is an increase in the
    labor force?
    A. Investment increases and savings decrease.
    B. Investment decreases and savings increase.
    C. There is no impact on investment or savings.
    D. It will be easier to reduce the unemployment
    rate.
    E. It will become more difficult to reduce the
    unemployment rate.


49. Which of the following do the Keynesians
    believe?
    A. Savings depends on interest rates.
    B. Government spending depends on interest
    rates.
    C. The economy returns itself to full
    employment.
    D. Macroeconomic equilibrium can occur at
    less than full employment.
    E. Wages are more flexible than prices.
    50. If the government increases its total spending by
    $10 billion yet it has no impact on GDP, what
    could be the reason for this?
    A. The price level is rising.
    B. There is high unemployment already present
    in the economy.
    C. The spending multiplier has increased.
    D. The economy is in equilibrium.
    E. There has been an increase in aggregate
    supply.


50. What is the most important factor in saving and
    consumption according to Keynesians?
    A. The interest rate
    B. The inflation rate
    C. The income of individuals
    D. The level of employment
    E. The price level and wages

52 through 54. Questions 52 through 54 refer to the

following graph.

52. What does each plot point on the graph above
    represent on the production possibilities curve?
    A. Quantity demanded
    B. Quantity supplied
    C. Supply and demand
    D. Opportunity costs
    E. All of the above

0 Y

X A

B

C

F

D

E

Macroeconomics Full-Length Practice Test 2

Macroeconomics Full-Length

Practice Test 2

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