Macro Economics: 100 most repeated MCQs in Exams
1. Which of the following best describes the concept of GDP
deflator?
a) Measures the change in the overall price level of goods
and services
b) Measures the change in real GDP over time
c) Measures the change in the nominal GDP over time
d) Measures the change in the unemployment rate
Answer: a) Measures the change in the overall price level of
goods and services
2. What is the formula for calculating the unemployment rate?
a) Number of unemployed / Total labor force
b) Number of employed / Total labor force
c) Number of unemployed / Total population
d) Number of employed / Total population
Answer: a) Number of unemployed / Total labor force
3. Which of the following is an example of an automatic
stabilizer?
a) Expansionary fiscal policy during a recession
b) A decrease in interest rates by the central bank
c) Progressive income tax system
d) A decrease in government spending during an economic
expansion
Answer: c) Progressive income tax system
4. The aggregate demand curve shows the relationship between:
a) The price level and the quantity of goods and services
demanded
b) The price level and the quantity of goods and services
supplied
c) Inflation and unemployment rates
d) Government spending and taxation
Answer: a) The price level and the quantity of goods and
services demanded
5. Which of the following is an example of an expansionary
monetary policy?
a) Decreasing government spending
b) Increasing taxes
c) Decreasing the money supply
d) Decreasing interest rates
Answer: d) Decreasing interest rates
6. The natural rate of unemployment is the:
a) Rate of unemployment that prevails when the economy is at
full employment
b) Rate of unemployment caused by changes in the business
cycle
c) Rate of unemployment caused by seasonal factors
d) Rate of unemployment caused by cyclical factors
Answer: a) Rate of unemployment that prevails when the
economy is at full employment
