Learning Module 2 Understanding Business Cycles

Which definition best captures a business cycle in the Burns and Mitchell sense?

Which cycle concept focuses on deviations of actual output from its long-term potential?

During which business cycle phase would firms most likely rely on overtime before hiring new workers?

Which indicator is typically considered a leading economic indicator?

A diffusion index measures which of the following?

Which of the following best describes a credit cycle relative to a business cycle?

If manufacturers' new orders for non-defense capital goods excluding aircraft decline materially, how would that indicator typically be classified and what would it signal?

Which of the following components typically appears in a composite leading indicator like the Conference Board LEI?

What is 'nowcasting' in macroeconomic analysis?

Which inventory behavior is most typical early in a recovery phase?

Which component of GDP is often the most volatile and procyclical?

Which fiscal tool is likely to have the slowest implementation lag but potentially increase the economy’s productive capacity long term?

Using the simple multiplier model with marginal propensity to consume (MPC) = 0.9 and a flat net tax rate t = 0.2, what is the fiscal multiplier for a change in government spending?

What is Ricardian equivalence in the context of fiscal policy?

Which of the following best describes an automatic stabilizer?

Which monetary policy tool is most directly used to target short-term interbank interest rates?

What is the neutral nominal policy rate approximately equal to, in terms of underlying components?

If a central bank cuts its policy rate but long-term yields fall less or rise because markets expect worse growth ahead, what monetary transmission problem does this illustrate?

Which monetary policy is most likely to be used when short-term rates are near zero but monetary authorities want to further ease financial conditions?

Which of the following is a key requirement for successful inflation targeting?

Which of the following institutional roles does the IMF primarily serve?

Which institution primarily helps developing countries finance projects and reduce poverty through loans and technical assistance?

The GATT served as the primary multilateral trade framework until it was replaced by which organization in 1995?

Which of the following best characterizes an event geopolitical risk?

Which of the following is an example of an exogenous geopolitical risk?

What is a thematic geopolitical risk?

Which of the following is a primary reason countries may pursue political cooperation (rules standardization)?

Which of these is an example of a financial geopolitical tool used to exert pressure between states?

Which of the following best describes an autarkic country in the globalization/cooperation framework?

If a country imposes sudden import tariffs on intermediate goods used by domestic manufacturers, which short-term effect is most likely?

Which indicator typically lags the business cycle?

Which best describes why central bank credibility matters for inflation control?

Which of the following is a major limitation of fiscal policy as a stabilization tool?

If a country’s current account deficit is large and financed with short-term external borrowing, which institution is most likely to be asked for emergency support?

Which measure best signals that an economy may be near a cyclical peak?

Which sector is most sensitive to the upswing in a recovery phase and often leads in rebounds?

If policymakers aim to prevent an overheating economy (excess demand and rising inflation), which combination is most appropriate?

Which of the following best describes the balanced-budget multiplier under standard assumptions?

Which scenario best illustrates a liquidity trap limiting monetary policy effectiveness?

Which of the following is a typical effect following a sovereign credit downgrade in a country experiencing rising deficits and low credibility?

Which of the following best explains why the Herfindahl-Hirschman Index (HHI) is preferred over a simple concentration ratio to assess market concentration?

Which investment implication follows from an expected transition from expansion to slowdown?

What are the three dimensions investors should assess when evaluating a geopolitical risk scenario?

Which policy mix tends to maximize the short-term GDP multiplier effect for a fiscal stimulus according to IMF-style analysis when monetary policy is accommodative?

Which is the most appropriate investor response to an anticipated short-duration geopolitical event risk with high probability and low expected impact?

Which of the following is a hallmark of an inflation-targeting central bank’s communication strategy?

Which of the following best summarizes the relationship between credit booms and banking crises?

Which indicator would most likely confirm that a recession has begun after the initial signs appear?

Which is an appropriate use of a diffusion index?

An analyst notes the yield curve (10-year minus overnight rate) becoming inverted while building permits are falling. What is the most likely near-term macro signal from these combined observations?