Final sample Questions - Final Exam Sample Questions 1. Use...

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Final Exam Sample Questions 1. Use competitive supply/demand diagrams and brief verbal explanations to analyze: a. The economic incidence of a $1.00 per-unit excise tax legally imposed on the sellers of a luxury good with a before-tax price of $50.00. b. The effects on price, quantities, and total revenue of minimum wage law imposed in a resource market with highly elastic labor demand. c. The effects on price, quantity, and total revenue of technological progress and rising incomes. (10 points) d. a lunatic puts cyanide in randomly selected Extra Strength Tylenol bottles e. an unseasonable frost destroys half the California and Florida orange crops f. stock speculators (both buyers and sellers) expect higher future stock prices 2. Suppose the economy is initially in equilibrium at less than full-employment. Using planned total expenditure (Planned TE)/Keynesian aggregate supply (AS K ) and real aggregate supply (AS R ) diagrams and brief verbal descriptions, explain how policymakers’ attempts to restore full-employment and an adverse supply shock can lead to stagflation.(30 points) 3. First, identify the underlined terms : then explain the relationship between the terms. a) marginal tax rates and Reagan Administration supply side economic policies (15 points) b) the Monetarist view of money demand and velocity (15 points) c) “Animal spirits ” and Investment Demand (10 points) d) the Quantity Theory of Money and inflation (15 points) e) a 5% unemployment rate and full-employment (15 points) f) the monetarist view of money demand and velocity (15 points) g)
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This note was uploaded on 09/26/2011 for the course ECON 1113 taught by Professor Clark during the Fall '08 term at The University of Oklahoma.

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Final sample Questions - Final Exam Sample Questions 1. Use...

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