The indifference map A) shows that the consumer is indifferent among all consumption bundles. B) is an individual indifference curve. C) captures the same information as the utility function. D) is impossible to derive from the utility function. ANSWER C
Date: September 10th, 2020
The idea behind the Phillips curve is that ________. A) tight labor markets lead to inflationary pressures B) when the unemployment rate is low, wages will increase C) when firms raise wages to attract new workers, prices will also increase D) all of the above E) none of the above ANSWER D
Date: September 10th, 2020
Open Market operations consist mainly of ________. A) the government buying and selling private securities in the open market B) the Fed buying and selling government securities in the open market C) the government selling its own securities in the open market D) the Fed setting rates for securities traded in the open market E) […]
Date: September 10th, 2020
Macroeconomists are interested in how consumers respond to changes in the market real interest rate because A) interest rates are an important channel for the effects of monetary and fiscal policies. B) substitution effects and income effects net out in the aggregate. C) of the permanent income hypothesis. D) future income affects current consumption. […]
Date: September 10th, 2020
The decline in net worth that can result from an unanticipated decline in the price level is known as ________. A) a credit boom B) deleveraging C) a debt deflation D) federal funds rationing ANSWER C
Date: September 10th, 2020
The adoption of capital controls makes A) everyone in the domestic economy better off. B) some domestic residents better off and some worse off, although on average welfare increases. C) some domestic residents better off and some worse off, although on average welfare decreases. D) everyone in the domestic economy worse off. ANSWER C
Date: September 10th, 2020
For a lender, an increase in the real interest rate A) definitely reduces current consumption and increases future consumption. B) reduces current consumption and has an uncertain effect on future consumption. C) has an uncertain effect on current consumption and increases future consumption. D) has an uncertain effect on both current and future consumption. […]
Date: September 10th, 2020
The consumer’s work-leisure choice problem focuses on how a consumer’s work-leisure decision is affected by the consumer’s A) preferences and productivity. B) productivity and psychology. C) psychology and preferences. D) preferences and constraints. ANSWER D
Date: September 10th, 2020
In the New Keynesian open economy model A) the nominal exchange rate is always fixed. B) prices are flexible. C) net exports depends on the relative price of foreign goods to domestic goods. D) the nominal exchange rate is always flexible. ANSWER C
Date: September 10th, 2020
Leisure includes all of the following except A) sleep. B) home yardwork. C) market work. D) recreational activities. ANSWER C
Date: September 10th, 2020
