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Practice Macro Exam #2
Q1.
Suppose in Highland, it takes 6 hours to produce 1 litre of milk and 2 hours to
produce1 lbs of fish, whereas in Lowland, it takes 2 hours to produce 1 litre of milk and 1
hour to produce1 lbs of fish. Both countries would be better off by trading at a relative
price of milk ranging
a)
Between 2 and 3 lbs of fish per litre of milk
b)
Between 1/3 and 1/2 lbs of fish per litre of milk
c)
Between 1 and 3 lbs of fish per litre of milk
d)
Between 1/2 and 3 lbs of fish per litre of milk
e)
Between 1/3 and 2 lbs of fish per litre of milk
Q2.
Assume the government pays a statistician at the Statistics Canada $60,000 in salary
in 2004, and $40,000 in retirement benefits in 2005.
Q3.
All else equal, a decrease in the US interest rates would
Q4.
If a country reported nominal GDP of 200 billion in 2005 and 150 billion in 2004
and reported a GDP deflator of 125 in 2005 and a GDP deflator of 120 in 2004 then
from 2004 to 2005,

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