BADM 7200 Exam 2 | Full Questions and Answers | 2026 Update | 100%
Correct – LSU.
Started on Saturday, February 14, 2026, 5:11 PM
State Finished
Completed on Saturday, February 14, 2026, 6:36 PM
Time taken 1 hour 25 mins
Points 32.00/40.00
Grade 80.00 out of 100.00
,Question 1
Incorrect 0.00 points out of 1.00
A rise in money demand will, according to the large open economy model with floating exchange
rates, lead to:
■ a. a rise in income and net exports.
b. a decrease in income and net exports.
c. an increase in net capital outflows and a fall in net exports.
d. a fall in net capital outflows and an increase in net exports.
The correct answer is:
a decrease in income and net exports.
STUDY NOTE & EQUATION WORKSPACE:
,Question 2
Correct 1.00 points out of 1.00
In the case of demand-pull inflation, other things being equal:
a. both the inflation rate and the unemployment rate fall.
b. both the inflation rate and the unemployment rate rise at the same time.
c. the unemployment rate rises but the inflation rate falls.
✔■ d. the inflation rate rises but the unemployment rate falls.
The correct answer is:
the inflation rate rises but the unemployment rate falls.
STUDY NOTE & EQUATION WORKSPACE:
, Question 3
Correct 1.00 points out of 1.00
In a large open economy with a floating exchange rate, an increase in the domestic interest rate will
cause net capital outflow (NCO) to:
a. increase as capital leaves the country.
✔■ b. decrease because domestic assets become more attractive.
c. remain unchanged because capital is perfectly mobile.
d. decrease initially but increase sharply in the long run.
The correct answer is:
decrease because domestic assets become more attractive.
STUDY NOTE & EQUATION WORKSPACE:
Correct – LSU.
Started on Saturday, February 14, 2026, 5:11 PM
State Finished
Completed on Saturday, February 14, 2026, 6:36 PM
Time taken 1 hour 25 mins
Points 32.00/40.00
Grade 80.00 out of 100.00
,Question 1
Incorrect 0.00 points out of 1.00
A rise in money demand will, according to the large open economy model with floating exchange
rates, lead to:
■ a. a rise in income and net exports.
b. a decrease in income and net exports.
c. an increase in net capital outflows and a fall in net exports.
d. a fall in net capital outflows and an increase in net exports.
The correct answer is:
a decrease in income and net exports.
STUDY NOTE & EQUATION WORKSPACE:
,Question 2
Correct 1.00 points out of 1.00
In the case of demand-pull inflation, other things being equal:
a. both the inflation rate and the unemployment rate fall.
b. both the inflation rate and the unemployment rate rise at the same time.
c. the unemployment rate rises but the inflation rate falls.
✔■ d. the inflation rate rises but the unemployment rate falls.
The correct answer is:
the inflation rate rises but the unemployment rate falls.
STUDY NOTE & EQUATION WORKSPACE:
, Question 3
Correct 1.00 points out of 1.00
In a large open economy with a floating exchange rate, an increase in the domestic interest rate will
cause net capital outflow (NCO) to:
a. increase as capital leaves the country.
✔■ b. decrease because domestic assets become more attractive.
c. remain unchanged because capital is perfectly mobile.
d. decrease initially but increase sharply in the long run.
The correct answer is:
decrease because domestic assets become more attractive.
STUDY NOTE & EQUATION WORKSPACE:
