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ECON 213 Actual Exam (A Grade) | 138 Questions with Answers 100% Verified Correct|
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ECON 213 Actual Exam (A Grade) | 138 Questions with Answers 100% Verified Correct|
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ECON 213 Actual Exam (A Grade) | 138Questions with Answers 100% Verified Correct|
In the AS/AD model, long run macroeconomic equilibrium occurs when - ✔✔aggregate
demand equals short run aggregate supply and they intersect at a point on the long run
aggregate supply curve
An increase in aggregate demand causes an increase in ________ only in the short run, but
causes an increase in ________ in both the short run and the long run. - ✔✔real GDP; the
price level
Which of the points in the above graph are possible short-run equilibriums but not long-run
equilibriums? Assume that Y1 represents potential GDP. - ✔✔B and D
Why does the short run aggregate supply curve shift to the left in the long run, following an
increase in aggregate demand? - ✔✔Workers and firms adjust their expectations of wages
and prices upward and they push for higher wages and prices
Stagflation occurs when - ✔✔inflation rises and GDP falls
The main policy result (recommendation) of which of the following models (business cycle
theories) is that the quantity of money should be increased at a constant rate? - ✔✔the
monetarist model
Money is - ✔✔an asset that people are willing to accept in exchange for goods and services
The statement on the price tag that 'this laptop computer costs $1,500' illustrates which
function of money? - ✔✔unit of account
, The M2 measure of the money supply includes - ✔✔M1 + savings account balances + money
market deposit accounts + small denomination time deposits + non-institutional money market
fund shares
If the bank of Wachovia receives a $10,000 deposit, and the reserve requirement is 0.1 (or
10%), how much of the $10,000 can the bank legally loan out? (Assume that before the deposit,
this bank is meeting its legal reserve requirements.) - ✔✔$9,000
If the reserve requirement percentage is RR, the simple deposit multiplier is defined as -
✔✔1 / (RR)
The Federal Reserve undertakes ________ to manage the money supply and interest rates to
pursue selected macroeconomic objectives. - ✔✔monetary policy
Which of the following is NOT a tool the Fed (the Federal Reserve) uses to manage the money
supply? - ✔✔deposit insurance
The voting membership of the Federal Open Market Committee (FOMC) consists of - ✔✔the
Board of Governors plus five of the Federal Reserve Bank Presidents
If the Federal Open Market Committee (FOMC) wants to decrease the money supply through
open market operations, it will - ✔✔sell U.S. Treasury Securities
The velocity (V) of money is defined as - ✔✔the average number of times annually that each
dollar is used to purchase goods and services
Which of the following is a policy the Fed could pursue if it wanted to increase the money
supply to counter a recession in the short run? - ✔✔buy U.S. treasury bills
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