A. aggregation
B. fiscal
C. monetary
D. structural
Ans: B
AACSB: Reflective thinking
Blooms: Comprehension
Difficulty: Medium
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
34. Deregulation of the airline, trucking, telephone and electric utility industries are examples of _______ policy.
A. aggregation
B. fiscal
C. monetary
D. structural
Ans: D
AACSB: Reflective thinking
Blooms: Comprehension
Difficulty: Medium
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
35. If tax revenues equal 20% of total output and government expenditures equal 25% of total output, then there is a:
A. government budget surplus
B. trade surplus
C. government budget deficit
D. trade deficit
Ans: C
AACSB: Reflective thinking
Blooms: Comprehension
Difficulty: Medium
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
36. Which of the following would be considered an example of monetary policy?
A. A broad government initiative to reduce the country's reliance on agriculture and promote high-technology industries
B. A reduction in income tax rates
C. Provision of additional cash to the banking system
D. A decision by a developing country to reduce government control of the economy and to become more market-oriented
Ans: C
AACSB: Reflective thinking
Blooms: Comprehension
Difficulty: Medium
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
37. Positive analysis:
A. recommends whether a policy should be implemented
B. aims at determining only the economic consequences of a particular policy
C. depends on the analyst's values
D. determines whether the consequences of a policy are desirable
Ans: B
AACSB: Reflective thinking
Blooms: Knowledge
Difficulty: Easy
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
38. Normative analysis:
A. addresses the question of whether a policy should be used
B. aims at determining only the economic consequences of a particular policy
C. does not depend on the analyst's values
D. focuses on the actual effects of a policy
Ans: A
AACSB: Reflective thinking
Blooms: Knowledge
Difficulty: Easy
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
39. Which of the following statements is positive?
A. When the Reserve Bank increases the money supply, interest rates decrease
B. Large budget deficits should be avoided
C. Higher taxes are needed to support education
D. A tax cut that benefits low-income households is acceptable
Ans: A
AACSB: Analytical thinking
Blooms: Comprehension
Difficulty: Hard
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
40. Which of the following statements is positive?
A. Tax increases tend to discourage saving
B. Large budget surpluses should be avoided
C. Higher taxes are needed to support education
D. A tax cut that benefits high-income households is acceptable
Ans: A
AACSB: Analytical thinking
Blooms: Application
Difficulty: Hard
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?
Topic: Macroeconomic policy
41. ‘The central bank should raise interest rates in order to keep inflation at an acceptably low level’ is a _______ statement about _______ policy.
A. positive; fiscal
B. normative; fiscal
C. positive; monetary
D. normative; monetary
Ans: D
AACSB: Reflective thinking
Blooms: Comprehension
Difficulty: Medium
LO: 1.2 Can you identify the three major types of macroeconomic policy and discuss the difference between positive and normative analyses of macroeconomic policy?