Introduction to Macroeconomics quiz

Which of the following is a macroeconomic variable?

Macroeconomics emerged as a separate branch after:

The book The General Theory of Employment, Interest and Money was written by:

In a capitalist economy, production is mainly carried out for:

During the Great Depression, unemployment in the USA rose to about:

Which sector deals with exports and imports?

Classical economists believed that:

General price level is studied in:

Which is a feature of a capitalist economy?

Households supply which of the following to firms?

What is meant by aggregate demand? (2 marks)

Why did Keynes reject the classical view of automatic full employment? (2 marks)

State two functions of the government sector in an economy. (2 marks)

What is meant by investment expenditure by firms? (2 marks)

Give two examples of macroeconomic problems faced by India. (2 marks)

Explain the term labour as a commodity in capitalism. (2 marks)

What is the role of households as consumers and as factor owners? (2 marks)

How does the external sector affect a domestic economy? (2 marks)

Distinguish between individual demand and aggregate demand. (2 marks)

Why are macroeconomic policies usually made by the government or central bank? (2 marks)

Real GDP of an economy was Rs 500 lakh crore in year 1 and Rs 530 lakh crore in year 2. Calculate the growth rate. (3 marks)

In a country, the labour force is 40 crore and 2 crore people are unemployed. Calculate the number employed and the unemployment rate. (3 marks)

GDP contributions (Rs lakh crore) are: agriculture 54, industry 84 and services 162. Calculate the percentage share of each sector. (3 marks)

A country's exports are Rs 120 lakh crore and imports Rs 150 lakh crore, and its GDP is Rs 1,500 lakh crore. Calculate the trade balance and express it as a percentage of GDP. (3 marks)

Government expenditure is Rs 400 crore and tax revenue Rs 350 crore in an economy with GDP of Rs 2,000 crore. Calculate the gap between expenditure and taxes, and the share of government expenditure in GDP. (3 marks)

Read the passage and answer the questions. Between 1929 and 1933, output in the USA fell by about one-third and millions lost jobs. Factories had unsold goods, yet workers could not afford to buy them. (i) Name this event. (ii) Why could the classical theory not explain it? (iii) What solution did Keynes suggest? (5 marks)

Read the passage and answer the questions. Ravi owns a factory making bicycles. He hires 50 workers at a wage, rents a building and borrows money from a bank. He sells bicycles in the market and uses part of his profit to buy new machines. (i) Identify three features of capitalism in this example. (ii) What factor incomes does Ravi pay? (iii) Why does he reinvest profits? (5 marks)

Read the passage and answer the questions. The government of a country reduced income tax and increased spending on highways to create jobs during a slowdown. (i) Which sector is acting here? (ii) Is this a micro or macro policy? (iii) How will it affect households and firms? (5 marks)

Read the passage and answer the questions. When global demand for software services fell, Indian IT companies cut hiring, and incomes in some cities fell. (i) Which sector of the economy is involved? (ii) Explain how the external sector affected the domestic economy. (iii) Which macroeconomic variables are affected? (5 marks)

Read the passage and answer the questions. A family decides to save more to buy a house. If all families in the economy try to save more at the same time, total demand falls and firms reduce output. (i) Why is the result different for one family and the whole economy? (ii) What does this show about the need for macroeconomics? (iii) Name this idea. (5 marks)

Explain the emergence of macroeconomics as a separate branch of economics, discussing the Great Depression and the contribution of Keynes. (6 marks)

Explain the features of a capitalist economy. How does it differ from a socialist economy? (6 marks)

Explain the four sectors of a macroeconomy and their interrelationship with a chart. (6 marks)

Distinguish between microeconomics and macroeconomics on four bases, with examples, and explain why they are interdependent. (6 marks)

Discuss the major macroeconomic objectives of a government (growth, full employment, price stability, balance of payments stability), with a chart and Indian examples. (6 marks)