Economics Practice MCQ Page 23

Multiple Choice questions for Economics in the sets of 10 each on one page with questions and answers. All sets are useful in the preparation of subject tests for employment or admission.
Question: 1608   In the course of a business cycle ,a recession is followed by
  1. a trough.
  2. a recovery.
  3. a depression.
  4. an expansion.
  5. a peak.
Question: 1610   The average duration of business cycles from peak to peak is about
  1. 25 years.
  2. 10 years.
  3. 5 years.
  4. 2 years.
  5. less than one year.
Question: 1612   Inflation leads to inefficiency in the economy
  1. only when it occurs along with a recession.
  2. if resources are used to predict it.
  3. if people avoid singing long-term contracts.
  4. if it affects both wages and prices.
  5. in either of the situations described in b or c.
Question: 1614   When industrial countries fall into a recession ,developing countries
  1. are barely affected at all .
  2. see rising demand for their goods.
  3. are severely affected by falling demand for their goods.
  4. help them recover by buying goods from them.
  5. have inflation due to exchange rate changes.
Question: 1615   During a recession, the government
  1. collects more taxes.
  2. spends more on unemployment insurance.
  3. spends more on highways and defense.
  4. spends less overall.
  5. adjusts spending to keep the budget deficit constant
Question: 1617   The potential effects of inflation include all of the following except
  1. income redistribution from borrowers to lenders.
  2. scare resources devoted to anticipating and reacting to inflation.
  3. investment in inflation hedges,such as precious metals and art.
  4. possible changes in real output and employment.
Question: 1619   Which of the following is an intermediate good?
  1. A car purchased by an individual.
  2. A car purchased by a taxi cab company.
  3. A car purchased by the federal government.
  4. Gasoline purchased by an individual .
  5. Gasoline purchased by a taxi cab company.
Question: 1620   Which of the following products would not enter GD?
  1. Maid service.
  2. The service of a homemaker.
  3. The services of a house painter.
  4. A newly built house.
  5. The salary of the President of the would not States.
Question: 1621   Gross domestic product includes all of the following except
  1. personal consumption expenditures.
  2. investment expenditures.
  3. government purchases.
  4. government transfer payments.
  5. exports.
Question: 1623   Which of the following would be part of investment in the national income and product accounts?.
  1. Social Security benefits.
  2. A new post office.
  3. A new apartment building .
  4. A purchase of a new car by a consumer.
  5. Both b and c.
Question: 1624   An accumulation of unsold goods is
  1. counted in GDP as investment .
  2. counted in GDP as consumption .
  3. counted in GDP, but not as consumption or investment.
  4. not counted in GDP.
  5. counted in GDP,only if they are durable goods.
Question: 1625   Gross domestic income equals gross domestic product
  1. only when supply equals demand.
  2. only when there is no government .
  3. only when there is no government or foreign trade .
  4. only when depreciation is ignored.
  5. always.