Econ 201 Exam 3

Econ 201 Exam 3 - ECON201-EXAM3-CHAPTERS9-11(SAMPLE)...

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ECON201-EXAM3-CHAPTERS9-11(SAMPLE) Student:_______________________________________________________________________________________ Thissampleexamcontains100questions. Theactualexamwillcontain50ofthese100questions. 1. Ifa$20billionincreaseingovernmentexpendituresincreasesequilibriumGDPby$50billionthen: A. themultiplieris2. B. theMPCforthiseconomyis.6. C. inflationisoccurring. D. theMPSforthiseconomyis.6. 2. Ifanunintendedincreaseinbusinessinventoriesoccursat somelevelofGDP,thenGDP: A. entailsarateofaggregateexpendituresinexcessoftherateofaggregateproduction. B. maybeeitheraboveorbelowtheequilibriumoutput. C. istoolowforequilibrium. D. istoohighforequilibrium. 3. Ifthemarginalpropensitytosaveinaclosedeconomyis0.25andalump- sumtaxisimposed,theslopeofthe economy'saggregateexpendituresschedulewillbe: A. .25. B. lessthantheslopebeforethetax. C. greaterthantheslopebeforethetax. D. .75. 4. WhichofthefollowingwouldreduceGDPbythegreatestamount? A. a$20billionincreaseintaxes B. $20billionincreasesinbothgovernmentspendingandtaxes C. $20billiondecreasesinbothgovernmentspendingandtaxes D. a$20billiondecreaseingovernmentspending 5. Refertotheabovediagrams.CurveA: A. isaninvestmentscheduleandcurveBisaconsumptionoffixedcapitalschedule. B. isaninvestmentdemandcurveandcurveBisaninvestmentschedule. C. andBaretotallyunrelated. D. shiftstotheleftwhencurveBshiftsupward. 6. Refertotheabovediagram.Themultiplierinthiseconomyis: A. 0 E /0 A . B. BD / FG . C. FG / BD . D. BD / AD . 7. Refertotheabovediagram.ThelocationofcurveBdependsonthe: A. levelofrealGDP. B. locationofcurveAonly. C. interestrateonly. D. interestratetogetherwiththelocationofcurveA. 8. Itistruethat: A. equalincreasesingovernmentspendingandtaxesdonotchangetheequilibriumGDP.
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B. equalincreasesingovernmentspendingandtaxesreducetheequilibriumGDP. C. equalincreasesingovernmentspendingandtaxesincreasetheequilibriumGDP. D. taxeshaveastrongereffectuponequilibriumGDPthandogovernmentpurchases. 9. Refertotheabovediagramforaprivateclosedeconomy.Inthiseconomyaggregateexpenditures: A. donotchangeasGDPincreases. B. increaseby$2forevery$5increaseinGDP. C. increaseby$2forevery$4increaseinGDP. D. increaseby$2forevery$3increaseinGDP. 10. Foraprivateclosedeconomyaggregateexpendituresconsist of: A. C + I g . B. C I g . C. C + S . D. C S . 11. Refertotheabovetable.EquilibriumGDPis: A. $40. B. $70. C. $100. D. $130. 12. Refertotheabovediagram.Thesizesofthemultipliersassociatedwithchangesininvestmentandgovern ment spendinginthiseconomyare: A. 2.5and1.5respectively. B. 3and2respectively. C. both2.5. D. 2and3respectively. 13. Refertotheabovediagramforaprivateclosedeconomy.Themultiplieris: A. GF/DE . B. GF/GB . C. FE/GF . D. AB/GF . (Advancedanalysis)Answerthenext question(s)onthebasisofthefollowinginformationforamixedopen economy.Theletters Y , C a , Ig , Xn , G ,and T standforGDP,consumption,grossinvestment,net exports,
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governmentpurchases,andnet taxesrespectively.Figuresareinbillionsofdollars. C
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This note was uploaded on 07/06/2008 for the course ECON 201 taught by Professor Nwoha during the Spring '08 term at Grambling State.

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Econ 201 Exam 3 - ECON201-EXAM3-CHAPTERS9-11(SAMPLE)...

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