ECON304 - MidTerm01_KEY - F10

ECON304 - MidTerm01_KEY - F10 - ._ Sonoma State University...

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._ Sonoma State University Department of Economics ECN 304 Florence Bouvet Fall 2010 Midterm 1 Name (Please Print): ~-;,1J4ER. I/.-. .~ Scores: Part I: __ ~/50 Part II: __ ___:/50 Total: /100 Please Note: 1. Succinct responses are strongly encouraged. Any erroneous or too much irrelevant information will count against you. Therefore, you will not receive full credit if you provide a complete correct answer but also include erroneous or too much irrelevant information. No credit will be given to answers that do not address the question. 2. Show all your work. Make sure you show all equations used in each calculation. Answers without supporting calculations will receive very little credit. 3. For most questions, you are given a lot more space than you really need. When time is called, please stop work immediately. 1
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., Part I: Multiple Choice Questions (50 points, 2.5 points each) 1) If the production remains the same and all prices quadruple relative to the base year, then the GDP deflator a. 1,4 b. V2 c. 2 d. 4 \ . 2) In an economic model, a. Exogenous variables and endogenous variables are both fixed when they enter the model b. Endogenous variables and exogenous variables are both determined within the model c. Endogenous variables affect exogenous variables d. Exogenous variables affect endogenous variables 3) If the supplies of capital and labor are fixed, and technology is unchanged, then real output is a. Fixed b. Determined by demand c. Uncertain d. Subject to wide fluctuations 4) If the number of employed workers equals 200 million and the number of unemployed workers equals 20 million, the unemployment rate equals __ percent (rounded to the nearest percent). a. 0 b. 9 c. 10 d. 20 5) A competitive firm rents capital stock until the marginal product of capital equals the a. Real wage b. Real rental price of capital c. Price of output d. The capital/labor ratio 2
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For questions 6 to 8, please use the information provided in the following table Year 1 Year 2 Unit Price Quantity Unit Price Quantity Computers $1,200 5 $600 10 Bicycles $200 200 $240 250
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ECON304 - MidTerm01_KEY - F10 - ._ Sonoma State University...

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