Home Courses PHUONG Bao Ton Nu Thu

ELEARNING NEWS Search courses 

Dashboard  PE-S118DH43ISB-3  Problem set  PS12

Started on Thursday, 26 April 2018, 2:02 PM

State Finished
Completed on Thursday, 26 April 2018, 3:51 PM
Time taken 1 hour 49 mins

Question 1 1.The aggregate quantity of goods demanded decreases if

Complete
Select one:
Marked out of
a. real wealth falls.
1.0
b. the interest rate rises.
c. the dollar appreciates.
d. All of the above are correct.

correct

Question 2 2.A decrease in the price level

Complete
Select one:
Marked out of
a. causes real wealth to rise, people to lend more, interest rates to rise, and the dollar to appreciate.
1.0
b. causes real wealth to rise, people to lend more, interest rates to fall, and the dollar to depreciate.

c. causes real wealth to fall, people to lend less, interest rates to fall, and the dollar to depreciate.
d. causes real wealth to fall, people to lend less, interest rates to rise, and the dollar to depreciate.

correct

Question 3 3.When the dollar depreciates, each dollar

Complete
Select one:
Marked out of
a. buys more foreign currency, and so buys more foreign goods.
1.0
b. buys more foreign currency, and so buys fewer foreign goods.

c. buys less foreign currency, and so buys more foreign goods.

d. buys less foreign currency, and so buys fewer foreign goods.

correct

Question 4 4.Suppose a stock market boom makes people feel wealthier. The increase in wealth would cause people to
Complete
Select one:
Marked out of
a. increase consumption, which shifts the aggregate demand curve right.
1.0
b. increase consumption, which shifts the aggregate demand curve left.

c. decrease consumption, which shifts the aggregate demand curve right.

d. decrease consumption, which shifts the aggregate demand curve left.

correct

Question 5 5.When taxes increase, consumption decreases

Complete
Select one:
Marked out of
a. as shown by a movement to the left along the aggregate demand curve.
1.0
b. shifting aggregate demand to the left.
c. shifting aggregate supply the left.

d. which does none of the above.

correct

Question 6 6.Aggregate demand shifts right when the government

Complete
Select one:
Marked out of
a. increases taxes.
1.0
b. increases military expenditures.
c. increases the money supply.

d. Both b and c are correct.

correct
Question 7 7.If the dollar appreciates perhaps because of speculation or government policy then U.S.
Complete
Select one:
Marked out of
a. net exports increase and aggregate demand shifts right.
1.0
b. net exports increase and aggregate demand shifts left.
c. net exports decrease and aggregate demand shifts right.
d. net exports decrease and aggregate demand shifts left.

correct

Question 8 8.Which of the following does not determine the long-run level of real GDP?
Complete
Select one:
Marked out of
a. the price level
1.0
b. supplies of labor

c. available natural resources

d. available technology

correct

Question 9 9.The misperceptions theory of the short-run aggregate supply curve says that if the price level increases more than people expect, firms believe that the
Complete relative price of what they produce has

Marked out of Select one:

1.0
a. increased, so they increase production.

b. increased, so they decrease production.

c. decreased, so they increase production.

d. decreased, so they decrease production.

correct

Question 10 10.The sticky wage theory of the short-run aggregate supply curve says that when prices fall unexpectedly, the real wage
Complete
Select one:
Marked out of
a. rises, so employment rises.
1.0
b. rises, so employment falls.

c. falls, so employment rises.

d. falls, so employment falls.

correct

Question 11 11.The sticky price theory of the short-run aggregate supply curve says that when prices fall unexpectedly, some firms will have
Complete
Select one:
Marked out of
a. higher than desired prices which increases their sales.
1.0
b. higher than desired prices which depresses their sales.
c. lower than desired prices which increases their sales.

d. lower than desired prices which depresses their sales.

incorrect

Question 12 12.Which of the following shifts short-run aggregate supply left?

Complete
Select one:
Marked out of
a. an increase in the price level
1.0
b. an increase in the expected price level
c. an increase in the capital stock

d. All of the above are correct.

correct
Question 13
Complete

Marked out of
1.0

13.If the economy starts at A and there is a fall in aggregate demand, the economy moves

Select one:
a. back to A in the long run.
b. to B in the long run.

c. to C in the long run.

d. to D in the long run.

correct

Question 14
Complete

Marked out of
1.0

14.If a change in aggregate demand shifts the economy from A to D, the government might use fiscal policy to move the economy

Select one:
a. back to A.
b. to B.

c. to C.
d. to D.

correct

Question 15 15.Suppose a shift in aggregate demand creates an economic contraction. If policymakers can respond with sufficient speed and precision, they can offset
Complete the initial shift by

Marked out of Select one:

1.0
a. shifting aggregate demand right.
b. shifting aggregate demand left.

c. shifting aggregate supply right.

d. shifting aggregate supply left.

correct

Question 16 16.Which of the following are goals of monetary policy?

Complete
Select one:
Marked out of
a. maximizing the value of the dollar relative to other currencies, economic growth, and high employment
1.0
b. price stability, maximizing the value of the dollar relative to other currencies, and high employment
c. price stability, economic growth, and high employment.

d. price stability, economic growth, and maximizing the value of the dollar relative to other currencies.

incorrect
Question 17 17.Monetary policy refers to the actions the Central Bank takes to manage
Complete
Select one:
Marked out of
a. the money supply and income tax rates to pursue its economic objectives.
1.0
b. the money supply and interest rates to pursue its economic objectives.
c. income tax rates and interest rates to pursue its economic objectives.
d. government spending and income tax rates to pursue its economic objectives.

correct

Question 18 18. Liquidity preference theory is most relevant to the

Complete
Select one:
Marked out of
a. short run and supposes that the price level adjusts to bring money supply and money demand into balance.
1.0
b. short run and supposes that the interest rate adjusts to bring money supply and money demand into balance.

c. long run and supposes that the price level adjusts to bring money supply and money demand into balance.
d. long run and supposes that the interest rate adjusts to bring money supply and money demand into balance.

correct

Question 19 19. The supply of money is determined by

Complete
Select one:
Marked out of
a. the price level.
1.0
b. the Central Bank.

c. the value of money.

d. the demand for money.

correct

Question 20 20. The supply of money increases when

Complete
Select one:
Marked out of
a. the value of money increases.
1.0
b. the interest rate increases.

c. the Central Bank makes open-market purchases.

d. None of the above is correct.

correct

Question 21 Figure 1
Complete

Marked out of
1.0

21. Refer to Figure 1. In the figure above, the movement from point A to point B in the money market would be caused by

Select one:
a. an increase in the price level.
b. a decrease in real GDP.
c. an open market sale of Treasury securities by the Central Bank.

d. an increase in the required reserve ratio by the Central Bank.

incorrect

Question 22 22. The Central Bank can increase the federal funds rate by
Complete
Select one:
Marked out of
a. selling Treasury bills, which increases bank reserves.
1.0
b. buying Treasury bills, which increases bank reserves.
c. selling Treasury bills, which decreases bank reserves.

d. buying Treasury bills, which decreases bank reserves.

incorrect
Question 23 23.The money demand curve has a negative slope because
Complete
Select one:
Marked out of
a. lower interest rates cause households and firms to switch from money to financial assets.
1.0
b. lower interest rates cause households and firms to switch from financial assets to money.
c. lower interest rates cause households and firms to switch from money to stocks.
d. lower interest rates cause households and firms to switch from money to bonds.

incorrect

Question 24 24. An increase in real GDP

Complete
Select one:
Marked out of
a. increases the buying and selling of goods and increases the demand for money as a medium of exchange.
1.0
b. increases the buying and selling of goods and decreases the demand for money as a medium of exchange.

c. decreases the buying and selling of goods and increases the demand for money as a medium of exchange.
d. decreases the buying and selling of goods and decreases the demand for money as a medium of exchange.

correct

Question 25 25. The money demand curve would shift right if

Complete
Select one:
Marked out of
a. real GDP decreased.
1.0
b. the price level increased.

c. the interest rate increased.

d. the Central Bank sold Treasury securities.

incorrect

Question 26 26. According to liquidity preference theory, if the quantity of money supplied is greater than the quantity demanded the interest rate will
Complete
Select one:
Marked out of
a. increase and the quantity of money demanded will decrease.
1.0
b. increase and the quantity of money demanded will increase.

c. decrease and the quantity of money demanded will decrease.

d. decrease and the quantity of money demanded will increase.

correct

Question 27 27.According to liquidity preference theory, an increase in the price level shifts the
Complete
Select one:
Marked out of
a. money demand curve right so the interest rate increases.
1.0
b. money demand curve right so the interest rate decreases.
c. money demand curve left so the interest rate decreases.

d. money demand curve left so the interest rate increases.

correct

Question 28 28. Which of the following properly describes the interest rate effect?
Complete
Select one:
Marked out of
a. A higher price level leads to higher money demand, higher money demand leads to higher interest rates, a higher interest rate increases the quantity
1.0
of goods and services demanded.
b. A higher price level leads to higher money demand, higher money demand leads to lower interest rates, a higher interest rate reduces the quantity of
goods and services demanded.
c. A lower price level leads to lower money demand, lower money demand leads to lower interest rates, a lower interest rate reduces the quantity of
goods and services demanded.

d. A lower price level leads to lower money demand, lower money demand leads to lower interest rates, a lower interest rate increases the quantity of
goods and services demanded.

incorrect
Question 29 29. If the stock market booms
Complete
Select one:
Marked out of
a. household spending increases. To offset the effects of this on the price level and real GDP, the Fed would increase the money supply.
1.0
b. household spending increases. To offset the effects of this on the price level and real GDP, the Fed would decrease the money supply.
c. household spending decreases. To offset the effects of this on the price level and real GDP, the Fed would increase the money supply.
d. household spending decreases. To offset the effects of this on the price level and real GDP, the Fed would decrease the money supply.

correct

Question 30 30. Fiscal policy refers to the idea that aggregate demand is changed by changes in
Complete
Select one:
Marked out of
a. the money supply.
1.0
b. government spending and taxes.

c. trade policy.
d. All of the above are correct.

correct

Question 31 31. If the MPC = .85, then the government purchases multiplier is about
Complete
Select one:
Marked out of
a. 1.18.
1.0
b. 3.33.

c. 6.67.

d. 8.5.

correct

Question 32 32. Which of the following correctly explains the crowding-out effect?
Complete
Select one:
Marked out of
a. An increase in government expenditures decreases the interest rate and so increases investment spending.
1.0
b. An increase in government expenditures increases the interest rate and so reduces investment spending.

c. A decrease in government expenditures increases the interest rate and so increases investment spending.
d. A decrease in government expenditures decreases the interest rate and so reduces investment spending.

correct

Question 33 33. Assume the multiplier is 5 and that the total crowding-out effect is $20 billion. An increase in government purchases of $10 billion when the multiplier is 5
Complete will shift the aggregate demand curve

Marked out of Select one:

1.0
a. right $150 billion.
b. right $70 billion.
c. right $30 billion.

d. None of the above is correct.

incorrect
Question 34 Figure 2
Complete

Marked out of
1.0

34. Refer to Figure 2. In the figure above suppose the economy is initially at point A. The movement of the economy to point B as shown in the graph
illustrates the effect of which of the following policy actions by the Central Bank?

Select one:
a. A decrease in income taxes

b. An increase in the required reserve ratio

c. An open market purchase of Treasury bills
d. An open market sale of Treasury bills.

incorrect

Question 35 35. Aggregate demand shifts to the left and policymakers want to stabilize output. What can they do?
Complete
Select one:
Marked out of
a. repeal an investment tax credit or increase the money supply
1.0
b. repeal an investment tax credit or decrease the money supply

c. institute an investment tax credit or increase the money supply

d. institute an investment tax credit or decrease the money supply

correct

Question 36 36.Critics of stabilization policy argue that

Complete
Select one:
Marked out of
a. there is a lag between the time policy is passed and the time policy has an impact on the economy.
1.0
b. the impact of policy may last longer than the problem it was designed to offset.

c. policy can be a source of, instead of a cure for, economic fluctuations.

d. All of the above are correct.

correct

Question 37 37. According to the short-run Phillips curve, the unemployment rate and the inflation rate are
Complete
Select one:
Marked out of
a. unrelated.
1.0
b. positively related.

c. negatively related.
d. unaffected by monetary policy.

correct

Question 38 38. If policymakers expand aggregate demand, inflation

Complete
Select one:
Marked out of
a. falls, but unemployment rises.
1.0
b. and unemployment fall.
c. and unemployment rise.

d. rises, but unemployment falls.

correct
Question 39 Figure 3
Complete

Marked out of
1.0

39. Refer to Figure-3. What should the Federal Reserve do if it wants to move from point A to point B in the short-run Phillips curve depicted in the figure
above?

Select one:
a. buy treasury bills

b. sell treasury bills

c. lower the discount rate
d. increase the money supply

incorrect

Question 40 40.In the long run, the Phillips curve is a ________ at ________.
Complete
Select one:
Marked out of
a. horizontal line; 0% inflation
1.0
b. negatively sloped line; the intersection of aggregate demand and short-run aggregate supply

c. vertical line; the natural rate of unemployment

d. vertical line; the expected rate of inflation

correct

Question 41 41. If actual inflation is less than expected inflation, actual real wages will be _________ expected real wages and unemployment will _______.
Complete
Select one:
Marked out of
a. greater than; rise
1.0
b. greater than; fall

c. less than; rise

d. less than; fall

correct

Question 42 42.Suppose that the money supply increases. In the short run, this increases prices according to
Complete
Select one:
Marked out of
a. both the short-run Phillips curve and the aggregate demand and aggregate supply model.
1.0
b. neither the short-run Phillips curve nor the aggregate demand and aggregate supply model.

c. the short-run Phillips curve, but not the aggregate demand and aggregate supply model.
d. the aggregate demand and aggregate supply model but not the short-run Phillips curve.

correct

Question 43 43. The government of Libertina considers two policies. Policy A would shift AD right by 200 units while policy B would shift AD right by 100 units. According
Complete to the short-run Phillips curve policy A will lead

Marked out of Select one:

1.0
a. to a lower unemployment rate and a lower inflation rate than policy B.
b. to a lower unemployment rate and a higher inflation rate than policy B.
c. to a higher unemployment rate and lower inflation rate than policy B.

d. to a higher unemployment rate and higher inflation rate than policy B.

correct
Question 44 Figure 4
Complete

Marked out of
1.0

44. Refer to Figure 4. Suppose the economy is at point C in the figure above. Which of the following is true?

Select one:
a. The short-run Phillips curve will shift to the right.

b. The short-run Phillips curve will shift to the left.

c. The economy will move from C to A.
d. Workers and firms expect inflation to be 1%.

incorrect

Question 45 45. An increase in expected inflation shifts the

Complete
Select one:
Marked out of
a. short-run Phillips curve right.
1.0
b. short-run Phillips curve left.

c. long-run Phillips curve right.

d. long-run Phillips curve left.

correct

Question 46 46. Where does the short-run Phillips curve intersect the long-run Phillips curve?
Complete
Select one:
Marked out of
a. at the point where the rate of inflation and the unemployment rate are equal
1.0
b. at the natural rate of inflation

c. at the point where actual inflation is equal to expected inflation

d. There is no intersection between the short- and long-run Phillips curves.

correct

Question 47 47. What impact does monetary policy have on the long-run Phillips curve?
Complete
Select one:
Marked out of
a. Monetary policy can only shift the long-run Phillips curve to the left.
1.0
b. Monetary policy shifts the long-run Phillips curve to the right or left, depending on whether monetary policy is expansionary or contractionary.

c. Monetary policy can only shift the long-run Phillips curve to the right.
d. Monetary policy has no impact on the long-run Phillips curve.

correct

Question 48 48. Which of the following is correct if there is an adverse supply shock?
Complete
Select one:
Marked out of
a. The short-run aggregate supply curve and the short-run Phillips curve both shift right.
1.0
b. The short-run aggregate supply curve and the short-run Phillips curve both shift left.
c. The short-run aggregate supply curve shifts right and the short-run Phillips curve shifts left.

d. The short-run aggregate supply curve shifts left and the short-run Phillips curve shifts right.

correct

Question 49 49. Contractionary monetary policy would

Complete
Select one:
Marked out of
a. cause disinflation and make the short-run Phillips curve shift right.
1.0
b. cause disinflation and make the short-run Phillips curve shift left.
c. not cause disinflation, but make the short-run Phillips curve shift right.

d. not cause disinflation, but make the short-run Phillips curve shift left.

correct
 Question 50 50.If a central bank reduced inflation by 2 percentage points and that made output fall by 6 percentage points for 2 years and the unemployment rate rises
Complete from 3 percent to 5 percent for 2 years, the sacrifice ratio is

Marked out of Select one:

1.0
a. 1.

b. 2.
c. 3.
d. None of the above is correct.

correct

Question 51 51. If the sacrifice ratio is 2, reducing the inflation rate from 10 percent to 6 percent would require sacrificing
Complete
Select one:
Marked out of
a. 2 percent of annual output.
1.0
b. 6 percent of annual output.

c. 8 percent of annual output.

d. 12 percent of annual output.

correct

Question 52 52. A country is likely to have a lower sacrifice ratio if

Complete
Select one:
Marked out of
a. contracts are shorter, and the Central Bank is credible.
1.0
b. contracts are shorter, and the Central Bank has a poor reputation.

c. contracts are longer, and the Central Bank is credible.

d. contracts are longer, and the Central Bank has a poor reputation.

correct

Question 53 53. If the Fed announced a policy to reduce inflation and people found it credible, the short-run Phillips curve would shift
Complete
Select one:
Marked out of
a. right and the sacrifice ratio would fall.
1.0
b. right and the sacrifice ratio would rise.

c. left and the sacrifice ratio would fall.

d. left and the sacrifice ratio would rise.

correct

Question 54 54. Proponents of rational expectations argued that the sacrifice ratio
Complete
Select one:
Marked out of
a. could be high because it was rational for people not to immediately change their expectations.
1.0
b. could be high because people might adjust their expectations quickly if they found anti-inflation policy credible.
c. could be low because it was rational for people not to immediately change their expectations.

d. could be low because people might adjust their expectations quickly if they found anti-inflation policy credible.

incorrect

Question 55 55. Over the long run the Volcker disinflation

Complete
Select one:
Marked out of
a. shifted the short-run and long-run Phillips curves left.
1.0
b. shifted the short-run, but not the long-run Phillips curve left.
c. shifted the long-run, but not the short-run Phillips curve left.

d. None of the above is correct.

correct

Support
17 Pham Ngoc Thach, district 3, HCMC
International School of Business  Phone: 0914 061 652
 E-mail: tam.nguyen@isb.edu.vn

Copyright © 2016 - International School of Business.Powered by Moodle