METHODOLOGY/TERMINOLOGY

SAMPLE QUESTIONS

1. A variable that has been adjusted for price level changes

(inflation or deflation) would be called a(n):

a. independent variable

b. nominal variable

c. flow variable

d. stock variable

e. real variable

2. Which of the following is a stock (as opposed to flow) variable?

a. wealth

b. income

c. saving

d. wages

e. GDP

3. Which of the following is a macroeconomic variable?

a. the U.S. gross domestic product (GDP)

b. the price of a new Lexus

c. total sales of Big Macs last year

d. the average price of a laptop computer

4. If two variables are inversely related, then

a. there is no discernable relationship between the two

b. they both must be decreasing at the same time

c. one decreases as the other increases

d. the graph will be up-sloping to the right