Macroeconomics final exam (2010 AP)

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E (a sustained increase in real gross domestic product per capita)

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B (the exchange rate)

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C (Countries X and Y can engage in mutually advantageous trade by exchanging 1 watch for 1 radio)

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C (approximately increased by 10%)

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A (increasing government expenditures to build highways)

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A (reduce inflation)

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D (A car produced in the United States and sold in Europe)

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C (consumption, investment, government spending, and net exports)

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B (an increase in inflation)

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C (price - increase, quantity sold - decrease)

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C (8 percent)

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B (It is the accumulation of past and current budget deficits and surpluses)

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A (A decrease in the purchasing power of the currency)

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B (The demand curve for the currency will shift to the left and the currency will depreciate)

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D (two countries should benefit from trade unless both have equal opportunity costs in every good)

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A (increase in the nominal output)

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D (10)

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C (Interest rates will decrease)

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D (structural unemployment)

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A (Aggregate supply - increase Employment - increase)

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C (discouraged workers)

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D (increasing the reserve requirement)

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A (United States exports to fall)

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A ( households are on the demand side of the product market and the supply side of the resource market)

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C (selling bonds on the open market)

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B (government borrowing to finance its spending decreases private sector investment)

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B (it suggests that increases in output can occur without increases in price levels)

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D (A recent college graduate who is looking for her first job)

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C (Price - decrease, Quantity - increase)

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B (rational expectations)

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B (demand deposits)

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B (aggregate demand will decrease because the demand for United States exports decreases)

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D (engage in open-market purchases)

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B (it falls when interest rates rise, because the opportunity cost of holding money increases)

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D (a United States firm sells $500 million of its products to a Chinese company)

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D (the automatic stabilizing effect of fiscal policy will be eliminated)

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B (an increase in autonomous consumption)

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A (businesses on capital goods and changes in inventories)

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B (with long-run economic growth, there is an increase in aggregate supply)

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C (decrease personal income taxes and increase government spending by equal amounts)

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D (A decrease in the quality of human capital)

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B (nominal interest rates - increase, bond prices - decrease)

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E (technological progress)

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A (Demand for United States dollars and supply of euros)

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D (output - decrease, price level - decrease)

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E (the price level and/or real GDP had increased)

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C (an increase in the short-run aggregate supply and a decrease in the price level)

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D (the training and education of workers)

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A (A United States automovile manufactorer building a steel plant in Russia)

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C (it is vertical at the natural rate of unemployment)

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A (the distribution of income)

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E (greater than Y2)

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E (buying bonds increases the money supply which lowers the interest rate)

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D (value of the dollar - appreciate, net exports - decrease)

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C (a decrease in taxes of $100)

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C (population decreases)

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D (a decrease in aggregate supply)

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E (a decrease of $5 million)

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E (falling wages will shift the aggravate supply curve to the right, producing full employment)

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E (a sustained increase in real gross domestic product per capita)

answer

question

B (the exchange rate)

answer

question

C (Countries X and Y can engage in mutually advantageous trade by exchanging 1 watch for 1 radio)

answer

question

C (approximately increased by 10%)

answer

question

A (increasing government expenditures to build highways)

answer

question

A (reduce inflation)

answer

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D (A car produced in the United States and sold in Europe)

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C (consumption, investment, government spending, and net exports)

answer

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B (an increase in inflation)

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C (price - increase, quantity sold - decrease)

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C (8 percent)

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B (It is the accumulation of past and current budget deficits and surpluses)

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A (A decrease in the purchasing power of the currency)

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B (The demand curve for the currency will shift to the left and the currency will depreciate)

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question

D (two countries should benefit from trade unless both have equal opportunity costs in every good)

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A (increase in the nominal output)

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D (10)

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C (Interest rates will decrease)

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D (structural unemployment)

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A (Aggregate supply - increase Employment - increase)

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C (discouraged workers)

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D (increasing the reserve requirement)

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A (United States exports to fall)

answer

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A ( households are on the demand side of the product market and the supply side of the resource market)

answer

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C (selling bonds on the open market)

answer

question

B (government borrowing to finance its spending decreases private sector investment)

answer

question

B (it suggests that increases in output can occur without increases in price levels)

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D (A recent college graduate who is looking for her first job)

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C (Price - decrease, Quantity - increase)

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B (rational expectations)

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B (demand deposits)

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B (aggregate demand will decrease because the demand for United States exports decreases)

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D (engage in open-market purchases)

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B (it falls when interest rates rise, because the opportunity cost of holding money increases)

answer

question

D (a United States firm sells $500 million of its products to a Chinese company)

answer

question

D (the automatic stabilizing effect of fiscal policy will be eliminated)

answer

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B (an increase in autonomous consumption)

answer

question

A (businesses on capital goods and changes in inventories)

answer

question

B (with long-run economic growth, there is an increase in aggregate supply)

answer

question

C (decrease personal income taxes and increase government spending by equal amounts)

answer

question

D (A decrease in the quality of human capital)

answer

question

B (nominal interest rates - increase, bond prices - decrease)

answer

question

E (technological progress)

answer

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A (Demand for United States dollars and supply of euros)

answer

question

D (output - decrease, price level - decrease)

answer

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E (the price level and/or real GDP had increased)

answer

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C (an increase in the short-run aggregate supply and a decrease in the price level)

answer

question

D (the training and education of workers)

answer

question

A (A United States automovile manufactorer building a steel plant in Russia)

answer

question

C (it is vertical at the natural rate of unemployment)

answer

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A (the distribution of income)

answer

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E (greater than Y2)

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E (buying bonds increases the money supply which lowers the interest rate)

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D (value of the dollar - appreciate, net exports - decrease)

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C (a decrease in taxes of $100)

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C (population decreases)

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D (a decrease in aggregate supply)

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E (a decrease of $5 million)

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E (falling wages will shift the aggravate supply curve to the right, producing full employment)

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