2010SPRING-FINAL - ECO320L-Macroeconomic Theory Final Total...

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Unformatted text preview: ECO320L-Macroeconomic Theory Final Total 100 points NAME: ............................................................. Some Remarks: 1. Books and notes should be closed. 2. You can use a calculator. Exchange of calculator is not allowed. 3. Do not forget to label axes when you draw a graph. 4. Show your calculations and derivations. Just anwers will not receive any points. Good Luck and Have a Great Holiday! 1 Total Exam Grade: (........./100pts) Multiple Choice Questions (........./36pts) (3pts each) 1. The opportunity cost of money is (a) zero. (b) the inflation rate. (c) the real interest rate. (d) the nominal interest rate. 2. An open-market operation refers to (a) changing the money supply by changing taxes. (b) changing the money supply by changing government spending. (c) an exchange of money for interest-bearing debt by the monetary authority. (d) an exchange of domestic money for foreign money by the monetary authority. 3. If an increase in the level of the money supply results in a proportionate increase in prices with no effect on any real variables, we say that a the Fisher relationship holds. b money is neutral. c money is superneutral. d money is the most preferred store of value 4. Ricardian equivalence suggests that government budget deficits generated by decreases in current taxes (a) increase the current account surplus. (b) decrease the current account surplus. (c) have no effect on the current account surplus. (d) have unpredictable effects on the current account surplus. 2 5. When current account deficits are used to finance investment spending, such deficits may be self-correcting because (a) they promote more responsible government policies....
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2010SPRING-FINAL - ECO320L-Macroeconomic Theory Final Total...

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