econ351_summer2017_exam1_verB_key.docx

econ351_summer2017_exam1_verB_key.docx - ECON351 Exam 1...

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
ECON351 Exam 1 Version B Answer Key – 100 points in total Question 1 – Multiple Choice (from Ch.1-Ch.6) 1) (1 point) Almost all recessions in the 20th century were preceded by a drop in A) inflation. B) the money stock. C) the growth rate of the money stock. D) interest rates. Answer: C) 2) (1 point) If nominal GDP in 2001 is $9 trillion, and 2001 real GDP in 1996 prices is $6 trillion, the GDP deflator is 3) (1 point) The higher a security's price in the secondary market the ________ funds a firm can raise by selling securities in the ________ market. 4) (1 point) Which of the following is an example of an intermediate-term debt? 5) (1 point) Money is A) a flow of payments. B) anything that is generally accepted in payment for goods and services. C) the total collection of pieces of property that are a store of value. D) a medium of exchange based on a precious metal like gold or silver. Answer: B) 6) (1 point) If an individual moves money from a checking account to a money market deposit account 7) (1 point) Which of the following $1,000 face-value securities has the highest yield to maturity?
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
8) (1 point) When the government has a surplus, as occurred in the late 1990s, the ________ curve of bonds shifts to the ________, everything else held constant. 9) (1 point) A decrease in the riskiness of corporate bonds will ________ the yield on corporate bonds and ________ the yield on Treasury securities, everything else held constant. A) increase; increase B) decrease; decrease C) increase; decrease D) decrease; increase Answer: D) 10) (1 point) Everything else held constant, an increase in marginal tax rates would likely have the effect of ________ the demand for municipal bonds, and ________ the demand for U.S. government bonds.
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern