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final.questions.06 - Eco 402a Prof J Nilsen Final...

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Eco 402a Prof. J. Nilsen 1 Final Examination December 15 2006 True/False/Uncertain 6 points each . Credit will be given mainly on the strength of the logic justifying your response. Limit your answer to one or two sentences. 1. The Expectations Theory adequately explains all the important stylized facts for the term structure of interest rates. 2. A standard debt contract in the case of asymmetric information specifies that the borrower will repay to the lender a fixed share of his or her project outcome. 3. The golden rule level of capital is where the level of capital stock is minimized. 4. One realistic implication of the assumption of sticky prices in a Keynesian model is that the real wage is counter-cyclical.
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Eco 402a Prof. J. Nilsen 2 5. It is a straightforward exercise to empirically test the liquidity effect. 6. It is easy to separate the effects of technology from those of capital accumulation on the growth of GDP.
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