Macro Review

Which of the following is NOT a phase of the business cycle?

• Expansion

• Recession

• Inflation

• Peak

What does CPI stand for in economic terms?

• Consumer Price Index

• Cost Price Index

• Capital Price Index

• Commodity Price Index

Which phase of the business cycle is characterized by increasing economic activity and employment?

• Trough

• Expansion

• Recession

• Contraction

How does Keynesian economics view government intervention in the economy?

• It should be minimal

• It is necessary to stabilize the economy

• It should only occur during recessions

• It should focus on supply-side policies

According to Milton Friedman, what is the primary cause of inflation?

• Excessive government spending

• Increase in money supply

• High demand for goods

• Supply chain disruptions

Which of the following is a key difference between Keynesian and Classical economics?

• Role of government intervention

• Importance of technology

• Focus on long-term growth

• Emphasis on supply-side factors

Which phase of the business cycle is characterized by a decline in economic activity?

• Peak

• Expansion

• Recession

• Recovery

What is the primary focus of Monetarism as proposed by Milton Friedman?

• Fiscal policy

• Monetary policy

• Trade policy

• Industrial policy

What term is a tax that takes a larger share of income as income increases. A progressive income tax applies a higher tax rate to high incomes than to low incomes?

• Progressive tax
• Value-added tax
• Regressive tax
• Flat tax

What tax is a major source of revenue for local governments, is based on assessed value of real property (land/buildings), is often used to fund public schools which can lead to funding disparities between communities

• Income tax
• Sales tax
• Property tax
• Capital gains tax