ECON 201, Fall 2010, Midterm 2 questions without solutions doc

# Refer to the table above what is the level of

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15. Refer to the table above. What is the level of personal disposable income for this economy? A) \$ 1,080 billion B) \$ 1,010 billion C) \$ 980 billion D) \$ 860 billion 16. Increasing the amount of consumption spending and reducing the amount of savings ______ investment expenditures, and ______ long-run economic growth in the economy. 17. The real wage equals the nominal wage ______ the CPI, all times 100. 18. In a closed economy, there is a government budget surplus if

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19. Which of the following can explain why some countries have not experienced relatively high growth rates in real GDP per capita despite relatively low initial levels of real GDP per capita? A) Many of these developing countries do not have a court system that can enforce laws. B) Countries that are relatively poor are more likely to experience wars and revolutions. C) Countries that are relatively poor are likely to have a lower quality of health care. D) All of the above 20. The course packet reading on trade-adjustment assistance (TAA) concludes that a desirable policy would be 21. When the actual inflation rates turns out to be greater than the expected inflation rate the borrowers _____ and the lenders ____. 22. In years with positive growth and inflation, real GDP grows _________ nominal GDP. 23. If an economy experiences deflation the real interest rate A) will be less than the nominal interest rate. B) will be negative when nominal interest rate is positive. C) will be greater than the nominal interest rate. D) will be equal to the deflation rate, so long as the nominal interest rate is positive. 24. The biggest difference between unemployment in 2009-2010 vs. 1982 is: A) and B)
E) B) and C)

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