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08Spr_MacroExam1_versionA

# 08Spr_MacroExam1_versionA - 06E:002:AAA BBB Principles of...

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06E:002:AAA & BBB Principles of Macroeconomics Exam 1 Version A Name ___________________________________ Section Number ____________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In the circular flow model, the value of total income for an economy ________ the value of total production. 1) A) is less than B) is greater than C) may be greater than or less than D) equals 2) Prices of California Merlot wine (assume that this is a normal good) have risen steadily in recent years. Over this same period, prices for French oak barrels used for wine storage have dropped and consumer incomes have risen. Which of the following best explains the rising prices of California Merlots? 2) Table 11 Stage of Production Seller Buyer Price (Dollars) 1 Steel Mill Auto Manufacturer \$10,000 2 Auto Manufacturer Auto Dealer 18,000 3 Auto Dealer Consumer 25,000 Consider the following table showing three stages of production of an automobile. 3) Refer to Table 11. The value of each automobile in gross domestic product equals 3) 4) Refer to Table 11. The value added by the automobile dealer equals 4) 1

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06E:002:AAA & BBB Principles of Macroeconomics Exam 1 Version A Figure 6 Figure 4 - 9 shows the market for cigarettes. The government plans to impose a unit tax in this market. 5) Refer to Figure 6. For each unit sold, the price sellers receive after the tax (net of tax) is 5) A) \$8 B) \$12 C) \$4.40 D) \$3 6) Refer to Figure 6. How much of the tax is paid by buyers? 6) 7) In Singapore the government places a \$5,000 tax on the buyers of new automobiles. After the purchase of a new car, a buyer must pay the government \$5,000. How would the imposition of the tax on buyers be illustrated in a graph? 7)
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