exam 3 2007 - University of Houston INTB 3353: Economics of...

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University of Houston Spring 2007 INTB 3353: Economics of Globalization Professor Ruxandra Prodan Exam #3 - answers Name:_________________________________________________________________ 1. Outsourcing is: a. relocation of an organizational function to a foreign country b. transfer of an organizational function to a third party c. transfer of an organizational function to a third party, when the party is located outside the country Answer: b 2. A large negative output gap a. represents a shortage of goods due to excessive demand for output b. is the result of overtime work by the labor force c. creates inflation d. means the business cycle is at a peak e. implies excessive unemployment Answer: e 3. Which of the following is most likely to be an intermediate target for monetary policy? a. short term interest rates b. the unemployment rate c. the money supply d. investment expenditures e. gross domestic product Answer: c . 4. Which of the following is true of inflation targeting? a. it has been lately adopted by US b. it is conducted with secrecy rather than openess c. it is used less often than money growth targeting d. it has been adopted in practice by many major central banks Answer: d
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5. The National Bureau of Economic Research in the US provides the following definition of a recession : a. when an economy has experienced two successive quarters of negative growth b. if economic activity contracts for more than 3 years c. if economic activity contracts across a wide range of variables and a wide range of sectors d. all of the above Answer: c 6. Central banks commonly aim to keep the price level a. declining slightly b. perfectly constant c. growing by about 1% per year d. rising by about 2% per year e. increasing by about 5% per year Answer: d 7. Open market operations refer to a. all economic transactions not undertaken on the black market b. imports and exports of goods c. international currency transactions d. central banks holding reserves and lending to member banks e. the purchase and sale of treasury securities by central banks Answer: e 8. The effect of globalization on the Phillips Curve is that a. Low unemployment puts more pressure on wages to rise b. Low unemployment puts more pressure on interest rates to rise c. Low unemployment puts less pressure on interest rates to rise d. Low unemployment puts less pressure on wages to rise Answer: d 9. The migration surplus refers to a. unemployed workers who emigrate to other countries in search of jobs b. the unemployment created when immigrants enter a country c. the gain to society in extra output produced by immigrants
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This note was uploaded on 05/04/2010 for the course INTB 3353 taught by Professor Prodan during the Spring '08 term at University of Houston.

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exam 3 2007 - University of Houston INTB 3353: Economics of...

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