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Midterm 303_Sp2009 - Spring 2009 Prof Petry Econ 303...

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Spring 2009 Prof. Petry Econ 303 Midterm Exam March 12, 2009 You have 1 hour and 20 minutes to take this exam. The exam contains 51 mc questions. You should also confirm you have a formula sheet. You may use any calculator of your choice for the exam. All phones and other electronic devices must be turned off for the duration of the exam. Be sure to fill in your full name, net-id, and all the answers on the bubble sheet provided. It is your responsibility to protect the privacy of your work from other students, if your seating arrangement makes that difficult, please let us know and we will find another seat for you. You must sign and turn in both your exam and your scantron to the TA. GOOD LUCK! 1) Among the subjects covered in macroeconomics are the A) unemployment rate for the entire labor force. B) causes of the increase in the price of oil relative to other commodities. C) causes of the increase in the overall price level. D) Both A and C. 2) A rising inflation rate tends to injure the following types of people: 3) Business cycles in the United States 4) Much of macroeconomics is concerned with advising governments on ways to ________ business cycles, since it is desirable to ________. A) amplify, create the greatest cyclical peaks possible B) amplify, create deep recessions to cool down the economy C) dampen, avoid both very low troughs and very high peaks D) dampen, keep the economy at its maximum productive capacity 1
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5) "Natural" real GDP is defined as the total output 2
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6) Suppose that the natural rate of unemployment is 5.7 percent. If unemployment has for some time been varying between 5.1 and 5.3 percent, we should be at an actual real GDP ________ the natural real GDP, and should expect inflation to be ________. A) below, slowing down B) below, speeding up C) above, slowing down D) above, constant E) above, speeding up
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