MacroEcon MidTerm1 SP08 Answer Key

MacroEcon MidTerm1 SP08 Answer Key - ECON 4020 Spring 2008...

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ECON 4020 Spring 2008 Midterm exam 1 Name __________________________________________ This is a closed book exam. Exam is out of 100 points. Answer all the questions. Show all your calculations. Explain your answers in the essay type questions. You have 50 minutes to finish this exam. Academic Integrity: In cases of a violation of academic integrity it is the policy of the Department of Economics to impose the most severe penalties that are most consistent with University guidelines. GOOD LUCK!
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1. (4 points) Average labor productivity is the (a) amount of workers per machine. (b) amount of machines per worker. (c) ratio of employed to unemployed workers. (d) amount of output per worker. Answer: D 2. (4 points) A country has a trade deficit when (a) imports exceed exports. (b) imports equal exports. (c) exports exceed imports. (d) export is zero. Answer: A 3. (4 points) Classical economists argue that (a) the government should have an active role in the economy. (b) government policies will be ineffective and counterproductive. (c) the government should actively intervene in the economy to eliminate business cycles. (d) wages and prices don’t adjust quickly, so the economy is slow to return to equilibrium. Answer: B 4. (4 points) The country of Old Jersey produces milk and butter, and it has published the following macroeconomic data, where quantities are in gallons and prices are dollars per gallon. 2003 2004 Good Quantity Price Quantity Price Milk 500 $2 900 $3 Butter 2000 $1 3000 $2
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Between 2003 and 2004, nominal GDP grew by (a) 60.0%. (b) 65.5%. (c) 83.3%. (d) 190.0%. Answer: D
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5. (4 points) The expected real interest rate ( r ) is equal to (a) nominal interest rate minus inflation rate. (b) nominal interest rate minus expected inflation rate.
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This note was uploaded on 04/03/2008 for the course ECON 4020 taught by Professor Demidova during the Spring '08 term at University of Georgia Athens.

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MacroEcon MidTerm1 SP08 Answer Key - ECON 4020 Spring 2008...

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