Sample_MT2 - Name Student ID Section day and time Midterm 2...

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1 Name _________________________ Student ID ________________________ Section day and time _________________ Midterm 2 - Economics 101 (Fall 2009) You will have 45 minutes to complete this exam. There are 5 pages and 63 points. Version A. Multiple Choice: (16 points total, 2 points each) Choose best answer and record in blanks below. 1_____ 2_____ 3_____ 4_____ 5_____ 6_____ 7_____ 8_____ 1) The quantity theory of money says money supply multiplied by velocity equals: a) inflation b) nominal interest rate c) price d) nominal GDP 2) The classical dichotomy: a) says nominal variables do not affect real variables b) say real variables do not affect nominal variables c) holds mainly in the short run but not in the long run d) all of the above 3) Suppose money growth in Sweden in 2008 was 2%, GDP growth was 3%, the real interest rate was 4%, and velocity was constant. According to the quantity theory of money, inflation should be. a) 5% b) 2% c) 1% d) -1% e) none of the above 4) According to the Fisher Effect, if money growth rises in Sweden in the problem above, this should lead to a: a) fall in the nominal interest rate b) fall in the real interest rate c) rise in the nominal interest rate d) rise in the real interest rate 5) In the simple AS-AD model studied in class, an important distinction between the short run and long run is that ____ is sticky in the short run, but flexible in the long run. a)
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Sample_MT2 - Name Student ID Section day and time Midterm 2...

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