Econ_199_Aut_05_Exam__2

Econ_199_Aut_05_Exam__2 - Introduction to Macroeconomics...

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Introduction to Macroeconomics Allen R. Sanderson Economics 19900 Autumn 2005 SECOND HOUR EXAMINATION Name (Please Print): ______________________________________ [40 Points Possible] Part I. Multiple Choice. Circle letter corresponding to your answer. One point each; 20 points total. 1. Card and Krueger are names most associated with: a. the viewpoint that increases in the minimum wage do not contribute to unemployment. b. measuring the impact of deficit spending on employment and the price level. c. research on the causes of stagflation. d. the proposition that budget deficits have no effects on real interest rates or investment. e. developing generational accounting systems. 2. By the “classical dichotomy” we mean that: a. monetary policies are effective and symmetrical but fiscal policies are ineffective and asymmetrical. b. appropriate short-run macroeconomic policies are not advisable for the long run. c. forces that determine real variables are independent of those that determine nominal ones. d. prices and wages may be flexible in one direction (up) but not in the other (down). e. factors that influence AS are different from those that influence AD. 3. Which of the following is not one of the factors Parkin gives as an influence on a household’s saving decision? a. the real interest rate b. household disposable income c. household wealth d. a household’s expected future income e. foreign borrowing 4. A Laffer curve measures the relationship between: a. inflation and unemployment. b. monetary policy and the rate of inflation. c. government spending and the national debt. d. the tax rate and tax revenues. e. the state of the labor market and potential GDP. 5. According to Parkin, U.S. aggregate demand decreases if (or when): a. our price level increases (that is, we have inflation). b. incomes in Europe, Asia, and other North and South American economies grow. c.
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Econ_199_Aut_05_Exam__2 - Introduction to Macroeconomics...

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