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Exam (elaborations)

Ec 202 Exam 3 Questions With Correct Answers

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EC 202 EXAM 3 QUESTIONS WITH CORRECT ANSWERS

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A US mutual fund decides to increase its investments in Chinese companies. In our
framework, this
Increases the demand for dollars to exchange for Chinese currency
Increases the supply of dollars to exchange for Chinese currency
Has no effect on the market for dollars to exchange for Chinese currency


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Increases the supply of dollars to exchange for Chinese currency




NCO = NX. T or F?


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TRUE

,Why does aggregate demand slope down?


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Combination of wealth effect, interest rate effect, and exchange rate effect




Which of these would not be expected to shift the long-run supply curve to the right?
An increase in the average education level of workers
Substantial investments by business firms in information technology
Technological advances in producing solar power cheaply
An increase in the minimum wage


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An increase in the minimum wage




If there is crowding out, the change that gets multiplied is not ΔG but ..
2. Y increases less than the shift in AD, unless SRAS is flat


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(ΔG + ΔI), where ΔI is negative




Net Capital Outflow (NCO)=


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, Purchases of foreign assets by domestic residents - purchases of domestic
assets by foreigners
(Purchases of assets can be either foreign direct investment or foreign
portfolio investment)




real exchange rate=1, what does that imply about the nominal rate?


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e= cost of basket in yen / cost of basket in dollars




National saving: S =


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Y-C -G




Suppose all prices rose by 3 percent and all quantities rose by 3 percent. Which
statement is true?
Real GDP rose by 3 percent and nominal GDP by 6 percent
Real GDP and nominal GDP both rose by 3 percent
Nominal GDP rose by 3 percent and real GDP was constant


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Real GDP rose by 3 percent and nominal GDP by 6 percent

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