midterm1answersspring2008TRlecture

- Economics 302 Name Spring 2008 Tuesday/Thursday Lecture First Midterm Student ID Number March 3 2008 Section Number This 75 point midterm

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Economics 302 Name _______________________________ Spring 2008: Tuesday/Thursday Lecture First Midterm Student ID Number ____________________ March 3, 2008 Section Number _______________________ This 75 point midterm consists of three parts: a short response section with 5 short response questions worth 5 points each or a total of 25 points; a problem section with two problems worth 15 points each for a total of 30 points; and an essay section worth a total of 20 points. You will want to write legibly since illegible answers will be graded as wrong answers. You will want to present your work in an orderly fashion since a lack of organization will be interpreted as a lack of mental clarity and competent expression. You will want to make sure your answers are clear and easy to find on the test. All work should be done on the exam booklet and all answers should provide work and any formulas you used in answering the question. A lack of work for any answer will be penalized by a lower grade on that section. Calculators are fine to use. SCORE: Short Response 25 points 1. __________________ 2. __________________ 3. __________________ 4. __________________ 5. __________________ Problems 30 points 1. 15 points __________________ 2. 15 points __________________ Essay 20 points __________________ TOTAL 75 points __________________ I. Short Response (worth 5 points each or 25 points total) 1
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For each of the following statements write a brief answer. Make sure your answers are well organized, neatly written, and explicit. Do not exceed the space provided under the question: these are short responses. 1. (5 points) What is the difference between Endogenous and Exogenous variables within the context of an economic model? What is the difference between stock and flow variables? Is there any relationship between being an endogenous or exogenous variable and being a stock or flow variable? Exogenous variables are determined outside of model and are treated as given by the model, whereas endogenous variables are ones which are explained by the model. Stock variables are measured as the level of the variable at any given point in time, where flow variables are measured as the level of the variable over a specific time period. There is no relationship between stock/flow and endogenous/exogenous variables as you can have any possible combination of the two. 2. (5 points) Compare and contrast the Consumer Price Index and the GDP deflator: in your answer provide at least three points of comparison and/or contrast. The CPI and GDP deflator are both price indexes, but the CPI has a fixed market basket where the GDP deflator has a flexible basket. All domestic goods are included in the GDP deflator, but all consumed goods are included in the CPI regardless of being domestic or foreign. 3.
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This note was uploaded on 08/08/2008 for the course ECON 302 taught by Professor Gold during the Spring '07 term at Wisconsin.

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- Economics 302 Name Spring 2008 Tuesday/Thursday Lecture First Midterm Student ID Number March 3 2008 Section Number This 75 point midterm

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