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midterm 2 fall 2008 answers

midterm 2 fall 2008 answers - Name_Answer Key B-number...

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Name_____Answer Key________ B-number_____________ Section________ Econ 162B-A0, A1 Kenny Christianson Fall 2008 November 14, 2008 MIDTERM EXAMINATION NUMBER TWO (A) PART I MULTIPLE CHOICE (30 points) Choose the single best answer by circling the appropriate letter. 1. Which of the following is not a macroeconomic goal of the United States government? a. stable rates of GDP growth b. high employment rates c. stable prices d. low interest rates e. low unemployment rates 2. Which of the following is included in Gross Domestic Product for the United States? a. marijuana sales in New York State b. flour produced by a miller and sold to a baker c. the purchase of Lehman Brothers stock d. Coca-Cola produced in India e. economics classes at Binghamton University 3. Suppose that an economy suffers from deflation. Then in years after the base year, a. real GDP will be greater than nominal GDP. b. nominal GDP must be increasing. c. real GDP will be less than nominal GDP. d. real GDP will equal nominal GDP. e. none of the above. 4. The current account a. records the flows of financial assets between countries. b. is always equal to 0. c. has been in surplus in the United States in recent years. d. records the flows of goods, services, income and unilateral transfers. e. all of the above. 5. If there is a surplus in the current account, then a. the country has a trade deficit. b. imports must exceed exports. c. there must be a deficit in the capital and financial accounts. d. debits will be greater than credits. e. exports must be increasing over time.
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Econ 162B-90, 91 Fall 2008 Midterm Exam Two 2A 6. Purchasing Power Parity Theory a. states that currencies should have the same purchasing power in different countries. b. results from international arbitrage. c. is represented by the formula P = P f x E. d. provides a model for the long-term movements of exchange rates over time. e. all of the above. 7. Who would be included in the labor force? a. Arthur is in prison for selling cocaine. b. Betty is actively seeking employment as a carpenter but is currently without a job. c. Charlie is a college student actively looking for work. d. David is retired. e. Ed is without a job and has given up actively seeking employment. 8.
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