Figure 17-219) Refer to Figure 17-2. Suppose the economy is at point Bin the figure above. Which of the following is true? 19) ______ A) The natural rate of unemployment is 3.8%. B) The economy is producing at potential GDP. C) Expected inflation and actual inflation are the same. D) The current unemployment rate is 5%. E) The expected rate of inflation is 3%. 20) Refer to Figure 17-2. Suppose the economy is at point Cin the figure above. If workers adjust their expectations of inflation, which of the following will be true? 20) ______ A . 21) If the number of unemployed workers is 19 million, the number in the working-age population is 500 million, and the unemployment rate is 4%, how many workers are in the labor force? 21) ______ 22) If a person withdraws $500 from his/her checking account and holds it as currency, then M1 will ________ and M2 will ________. 22) ______
ECON104 Final Exam TIERNEY © 2014 8 Figure 15-1023) Refer to Figure 15-10. In the figure above, suppose the economy is initially at point A. The movement of the economy to point Bas shown in the graph illustrates the effect of which of the following policy actions by the Federal Reserve? 23) ______ A) an increase in income taxes B) an open market sale of Treasury bills C) a decrease in the required reserve ratio D) an open market purchase of Treasury bills 24) A decrease in the demand for eggs due to changes in consumer tastes, accompanied by a decrease in the supply of eggs as a result of an outbreak of Avian flu, will result in 24) ______
ECON104 Final Exam TIERNEY © 2014 9 Figure 11-125) Refer to Figure 11-1. Within a country, the impact of wars and revolutions and their subsequent destruction of capital is reflected in the per-worker production function in the figure above by a movement from 25) ______ C to A .
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