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Sample Questions for Midterm 2

Sample Questions for Midterm 2 - Sample Questions for...

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Sample Questions for Midterm II The set of objective type questions is only a preview. Along with this, you should make sure to cover in detail all the HWs preceding the Midterm. The essay questions and numerical type questions on the Midterm will be drawn ONLY out of these set of questions. There is thus no element of surprise on the second half of the exam. However, you should start thinking about the answers to these questions well in advance and discuss with me in case of difficulties. Chapter 6 ____ 1. When the economy is at its full employment Real GDP, the unemployment rate is equal to a. zero. b. the natural unemployment rate. c. the frictional unemployment rate. d. the structural unemployment rate. ____ 2. If the economy is in a recessionary gap, ____ 3. When the economy is producing Real GDP at a level at which the LRAS curve intersects the AD curve, the economy is ____ 4. The development of the Internet has altered the job search process. This has __________ the frictional unemployment rate and __________ the natural unemployment rate. ____ 5. If the economy is self-regulating and in a recessionary gap, a. wages and prices will fall. b. wages will fall, but prices will rise. c. neither wages nor prices will change. d. wages will rise, but prices will fall. e. wages and prices will rise. ____ 6. Which of the following statements is false?
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____ 7. In order for Say's law to hold in a money economy, ____
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