An increase in the desired stock of housing would be caused by ________. A) an increase in household formation B) higher residential consumption C) a decrease in expected future income D) an increase in home prices ANSWER A
Date: September 10th, 2020
Average labor productivity is computed as the A) ratio of industrial production to the employment rate. B) ratio of real output in manufacturing to the level of real GDP. C) ratio of real GDP to the unemployment rate. D) ratio of real GDP to the level of employment. ANSWER D
Date: September 10th, 2020
Which of the following is true of a small open economy, but not of a large open economy? A) Net exports are unlikely to be close to zero. B) The domestic real interest rate is equal to the world real interest rate. C) Changes in desired investment result in changes in the trade balance. D) […]
Date: September 10th, 2020
Through its impact on the desired stock of housing, higher expected income would lead to ________. A) an increase in residential investment B) a decrease in expected house price appreciation C) a decrease in residential investment D) a decrease in single-family dwellings ANSWER A
Date: September 10th, 2020
The notion that lenders must select from a pool of bad credit risks, because the most undesirable borrowers are those that most actively seek out a loan is known as the ________. A) moral hazard problem B) ornamental torsion problem C) adverse selection problem D) asymmetric innovation problem ANSWER C
Date: September 10th, 2020
In the new classical model, all wages and prices ________. A) are completely flexible with respect to expected changes in the price level B) are fixed with respect to expected changes in the price level C) are flexible with respect to the value of the dollar D) are fixed with respect to the money supply […]
Date: September 10th, 2020
The liquidity preference theory ________. A) distinguishes between nominal and real quantities B) shows that demand for real balances depends on real income C) shows that demand for real balances depends on the nominal interest rate D) all of the above E) none of the above ANSWER D
Date: September 10th, 2020
The saving-investment analysis for large open economies is somewhat more complicated than the analysis for small open economies mainly because ________. A) there is more information to keep track of for larger economies B) there are more unknowns in larger economies C) a larger economy may actually affect the world economy D) all of the […]
Date: September 10th, 2020
The single most important contributor to China’s economic growth has been ________. A) government-directed credit to key economic sectors B) strong demand for China’s exports C) rapid improvements in worker productivity D) a substantial increase in the utilization of labor and capital inputs ANSWER D
Date: September 10th, 2020
In the monetary small open-economy model with a flexible exchange rate, an increase in the foreign price level has which impact on domestic money demand? A) It increases it. B) It decreases it. C) It has no impact. D) It depends. ANSWER A
Date: September 10th, 2020
