Midterm Exam Macroeconomics (50 points) (1 Semester, 2010 Type A)

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Oct 28, 2013 (3 years and 11 months ago)

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1

Midterm Exam


Macroeconomics (
5
0 points)

(1
st

Semester, 20
10


Type A)

Name:





Student Number:

I solemnly swear NOT to cheat, therefore
upholding

my
conscience
. (Signature: )

I.

Answer

the multiple choice questions

below
: (
2

points each)

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16. 17.

18.


19.


I.
Using the loanable funds market model, e
xplain what happens to consumption, investment, and the
interest rate in the long run (1) when the government increases government expenditure, and (2) when the
government decreases tax revenue.
(3)
How these two cases are different (similar)? (Use equatio
ns and
graphs.) (10 points)






















II
.
Using the concept of money supply and money demand, derive
the classical quantity equation, explain
the impact of an increase in the money supply in the long run. Explain why classical economists think
money is neutral? (10 points.)

(10 points; Write answers on the back.)


2

I.
Find the most appropriate answer to t
he following
multiple
-
choice questions: (
2

points
each)


1
. All of the following are
flow

variables EXCEPT:

(1)
consumption

(2)
interest
rate

(3)
in
vestment


(4)

GDP

(5)
government spending


2
. In the national income accounts,
investment

include
s

all of the following except


(1)
firm

s spendin
g on equipment


(2)
increase in
the value of firm’s
inventor
ies


(3)
household’s purchase of
new houses


(4)
firm
’s purchase of stocks


(5)
firm’s spending on plant


3
.

An economy’s _________
always
equals its ________________.

(1)

S
aving
; in
vestment

(2)

expenditure on goods
; expenditure on
services

(3)

exports; imports

(4)

GDP
;
sum of values added at all production stages

(5)

government expenditure; tax revenue


4
. Suppose that a farmer g
rows wheat and sells it to a baker for $20, the baker makes bread and sells it to
a store for $
3
0, and the store sells it to the customer for $
5
0. This transaction increases GDP by


(1) $0. (2) $20.


(3) $
3
0.


(4) $
5
0.



(5) $1
0
0.


5
.
Which of the following is NOT a correct statement about
saving
?

(1)

Private saving
equal
s disposable income minus consumption.

(2)

Public saving
equal
s

government spending
minus

tax revenue.

(3)

National saving
equal
s the sum of private saving and public saving.

(4)

Natio
nal saving equals income minus the sum of consumption and government spending.

(5)

The

supply of loanable funds comes from
both
private saving

and

public saving.


6
. If
the amount of
national
production
increases by 10%
and all prices
increase by
5
%
, then


(1) real GDP
i
ncrease by
5
%
.

(2) real GDP
increases by
15
%
.

(3) nominal GDP
increases by
10
%
.

(4) nominal GDP

increases by 15%.

(5)
None of the above
.



3

7
. Which of the following statements about the CPI and the GDP deflator is
NOT true
?

(1) The GDP defla
tor is measured as
nominal

GDP divided by
re
al

GDP.

(2) The CPI measures the price of a basket of goods and services for the typical
consum
er
.

(3)
The GDP deflator is broader than CPI in the coverage of goods and services.

(4)
P
rices of imported goods are

not

included
either
in
CPI.

(5)
T
he composition of basket is fixed for CPI and
but not for
the GDP deflator.


8
.

According to t
he
Fisher equation
:

(1)
a 1
0

percent rise in the rate of inflation causes a 1
0

percent rise in the
wage rate.

(
2
)
a 1
0

percent rise in the rate of inflation causes a 1
0

percent rise in the
real interest rate.

(
3
)
a 1
0

percent rise in the rate of inflation causes a 1
0

percent rise in the
nominal interest rate.

(
4
)
a 1
0

percent rise in the
real interest
rate causes a 1
0

per
cent rise in the
rate of inflation.

(
5
)
a 1
0

percent rise in the
nominal interest
rate causes a 1
0

percent rise in the
rate of inflation.


9
. When the government raises revenue by printing money, it imposes an "inflation tax" because the

(1) Printing mone
y to raise revenue causes inflation and this will cause nominal value of money holdings
increases
.

(2) Printing money to raise revenue causes inflation and this will cause the real interest rate to
increase
.

(3) Printing money to raise revenue causes infla
tion and this will cause the nominal interest rate to
increase.

(4) Printing money to raise revenue causes inflation and people will have to pay more taxes under
inflation.

(5) Printing
money to raise revenue causes inflation which is like a tax on people
who hold money.


10
. One effect of an unexpected rise in inflation is that wealth is redistributed from

(1) poor people to wealthy people.

(2) wealthy people to poor people.

(3)
lenders to borrowers.

(4) borrowers to lenders.

(
5
) young people to old peopl
e.


1
1
. According to the classical
economists
, which of the following variables is
NOT
affected by monetary
policy?


(1)

t
he
nominal

wage

rate


(2)

t
he nominal

interest rate
(3)

the n
ominal

GDP

(4)
i
nflation rate


(5)
real interest

rate



4

1
2
. Hyperinflation usually occurs when


(1) people spend too much money.


(2) workers demand higher and higher wages.

(3) governments collect more and more taxes.


(4) governments print too much money to finance their spending.


(5) the economy grows too fa
st.


13
. Frictional unemployment occurs because

(1)
the minimum wage is too high.

(2)

labor
unions
put

pressure in the labor market.

(3)
rigidities exist in the wage
-
setting process.

(4)
it takes time to match firms and workers.

(5)
All of the above.


14
.

Which of the following policies would reduce the amount of frictional unemployment?

(1)
A reduction in corporate taxes

(2)
An increase in unemployment insurance

(3)
An increase in the minimum wage

(4)
An increase in the public retraining programs

(5) An
decrease in
the

labor union power.


1
5
. Structural unemployment results when

(1)
the minimum wage is set to increase in the near future.

(2)
there is generous unemployment insurance.

(3)
workers are temporarily laid off due to weather conditions.

(4)
the

real wage is
below

its market
-
clearing level.

(5) Labor
unions
put

pressure in the labor market.





5

<<
보너스

문제
>>

1
6
.
다음



한국의

실업률

계산방법과

관련한

설명



틀린


?

(1)
조사대상월

30


현재



18





인구



경제활동인구를

대상으로

고용지표를




(2)
조사대상주간에

수입을

목적으로

1
시간

이상

일한

자는

취업자로

분류

(3)
동일가구내


구원이

운영하는

농장이나

사업체의

수입을

위해

주당

18
시간이상

일한

무급가족종사자는

취업자로

분류

(4)
직업

또는

사업체를

가지고

있으나

일시적인



또는

사고
,
연가
,
교육
,
노사분규

등의

사유로

일하지

못한

일시

휴직자는

취업자로

분류

(5)
조사대상주간에

수입있는

일을

하지

않았고
,
지난

4
주간

일자리를

찾아

적극적으로


직활동을

하였던

사람으로서

일자리가

주어지면

즉시

취업이

가능한

사람은

실업자로

분류


17. 2010


3


현재

우리나라의

실업률은
?

(1) 2.1% (2) 3.1% (3) 4.1% (4) 5.1% (5) 6.1%



18.
한국의

2009
년도

GDP


관한

설명



옳지

않은

것은
?

(1) GDP


대한

지출을

민간최종소비지출
,
정부최종소비지출
,
총고정자본형성
,
재고증감
,

화와서비스의

수출
,
재화와

서비스의

수입
,
통계상

불일치로

구분할



있다
.

(2)
위의

부분



민간최종소비지출의

비중이

54%


가장

크다
.

(3)
정부최종소비지출은

총고정자본형성의

비중보다

크다
.

(
4
) 2009
년도

실질
GDP


전년도에

비하여

플러스

성장하였다
.

(
5
) 2009
년도

일인당

GDP




달러기준으로

2


달러에

미달하였다
.


19.
다음



우리나라의

소비자물가지수

계산에서

가장

가중치가



부문은
?

(1)
식료품
,
비주류음료

(2)
주거



수도

광열비

(3)
외식
,
숙박

(4)
교육

(5)
교통