201FFall03 - Name Section ECON 201 Prof Gordon Final Exam...

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Name: ECON 201 12/9/2003 Prof. Gordon Final Exam Section#: Directions: Answer the Multiple choice questions on this sheet. Answer the short answers on the paper on which they are printed, boxing your answers (write your initials in upper right corners on each of those pages for extra security in case papers get separated). Budget your time carefully. GOOD LUCK! Multiple Choice Answer Sheet 1 19 37 2 20 38 3 21 39 4 22 40 5 23 41 6 24 42 7 25 43 8 26 44 9 27 45 10 28 46 11 29 47 12 30 48 13 31 49 14 32 50 15 33 51 16 34 52 17 35 53 18 36 54
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Multiple Choice Section: 54 questions, 81 points 1 The short-run aggregate supply curve is upward sloping because A. a lower price level creates a wealth effect. B. lower taxes motivate people to work more. C. money wages do not immediately change when the price level changes. D. most business firms operate with long-term contracts for output but not labor. 2 A change in the full-employment quantity of labor ____ the short-run aggregate supply curve and ____ the long-run aggregate supply curve. a) shifts; shifts b) shifts; does not shift c) does not shift; shifts d) does not shift; does not shift 3 According to the wealth effect, an increase in the price level ____ real wealth and ____ consumption expenditure. a) increases; increases b) increases; decreases c) decreases; increases d) decreases; decreases 4 Economic growth will occur and the price level will be constant when the increase in aggregate demand a) exactly equals the increase in long-run aggregate supply. b) is more than the increase in long-run aggregate supply. c) is less than the increase in long-run aggregate supply. d) is accompanied by a decrease in short-run aggregate supply. 5 Which of the following would lead to a downward shift in the nation’s production function? a) Workers have more physical capital to work with b) Workers have engaged on in on-the-job training c) Workers have less human capital than before d) The size of the labor force has decreased 6 Because the marginal product of labor decreases as the quantity of labor employed increases, the quantity of labor a firm demands a) rises as the real wage rate falls. b) rises as the money wage rate rises. c) can either rise or fall as the real wage rate changes depending on what is happening to the money wage rate. d) none of the above because the marginal product of labor is independent of the quantity of labor demanded.
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7 A rise in the real wage rate increases the labor-force participation rate because the higher real wage rate a) reduces the value of other activities. b) makes time spent working relatively more valuable. c) reduces the productivity of leisure time. d) All of the above contribute to a rise in the labor-force participation rate. 8
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This note was uploaded on 09/04/2010 for the course ECON 201 taught by Professor Witte during the Spring '08 term at Northwestern.

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201FFall03 - Name Section ECON 201 Prof Gordon Final Exam...

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