Econ 311fallfinal2006

Econ 311fallfinal2006 - Intermediate Macroeconomics 311...

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1 Intermediate Macroeconomics 311 (Professor Gordon) Final Examination Fall, 2006 YOUR NAME: INSTRUCTIONS: 1. The exam lasts 2 hours. 2. The exam is worth 120 points in total: 30 points for the multiple choice questions, 60 points for the analytical questions, and 30 points for the essays. 3. Write your answers to Part A (the multiple choice section) in the blanks on page 1. You won’t get credit for circled answers in the multiple choice section. 4. Place all of your answers for part B in the space provided 5. Show your work for part B questions 6. Write your essays with a pen. Write clearly! 7. Good Luck and Happy Holiday! PART A Choose the ONE alternative that BEST completes the statement or answers the question. Your answers must be in the space provided below. USE CAPITAL LETTERS. 1. _ _ __ 6. ___ _ 11. ____ 16. _ _ __ 21. _ _ __ 26. _ _ __ 2. _ _ __ 7. ___ _ 12. _ _ _ 17. _ _ __ 22. _ _ _ 27. _ _ 3. ___ _ 8. _ _ __ 13. ____ 18. _ _ __ 23. _ _ __ 28. _ _ _ 4. ___ _ 9. _ __ _ 14. _ _ _ 19. _ _ __ 24. _ _ __ 29. _ _ __ 5. _ _ __ 10. _ _ __ 15. _ _ __ 20. _ _ __ 25. _ _ __ 30. _ _ _
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1.) Steady state growth will occur according to Robert Solow when A) Y = K. B) y = N. C) kn = y. D) k = n. 2.) If labor's share of national income is to remain constant, then __________. A) labor productivity must grow faster than the real wage B) the combined growth rates of labor productivity and the real wage must equal the growth rate of national income C) the real wage must grow faster than labor productivity D) the real wage must grow at the same rate as labor productivity 3.) The purchasing power parity theory (PPP) of the exchange rate implies that the real exchange rate between two countries A) should be constant. B) should rise when the foreign price level increases relative to the domestic price level. C) should fall when the foreign price level decreases relative to the domestic price level. D) (B) and (C). 4.) In moving from a small to a large open economy model under fixed exchange rates, fiscal policy A) remains totally ineffective. B) loses some of its effectiveness. C) maintains the same degree of effectiveness. D) gains extra effectiveness. 5.) “Given the long run implication of Solow’s growth model with respect to the rate of savings, the low savings rate in the U.S. is not a problem.” This statement overlooks that over time it appears that A) total factor productivity and the growth rate of capital per person are positively related. B) total factor productivity and the growth rate of capital per person are inversely related. C) total factor productivity and the difference between the growth rates of capital per capita and population are not related a and k – n are not related. D) savings rates and per capita growth rates are inversely related.
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This note was uploaded on 04/07/2008 for the course ECON 311 taught by Professor Gordon during the Fall '08 term at Northwestern.

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Econ 311fallfinal2006 - Intermediate Macroeconomics 311...

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