Course name: Macroeconomics, the European Perspective
Date examination: 24 June 2019
Duration 3 hrs; from 9.00 to 12.00
Examination: end term
Total number of pages: 15
Total number of questions: 6
Full name : -------------------------------------------------------------------------------------
Student ID Number : ------------------------------------------------------------------------
Signature : --------------------------------------------------------------------------------
Put your ID on your table for inspection.
Exam instructions
At the start of the exam
• Candidates who arrive more than 30 minutes after the time scheduled for the start of
the examination will not be permitted entry to the examination room.
During the examination
• Nobody is allowed to leave the room within the first 30 minutes after the start of the
exam.
• You are not allowed to go to the restroom unless you have permission of the
Examiner or an invigilator.
• MOBILE PHONES AND OTHER COMMUNICATION DEVICES ARE ONLY
ALLOWED WHEN SWITCHED OFF AND STORED IN CLOSED BAGS.
• It is not allowed to use any study aids such as books, readers, calculators
(pre-programmed), compilation of law decrees and lawbooks.
• Answer the exam questions on the question form (within the outlined subjects).
Results/Post-examination regulations
• The results of the examination will be published in OSIRIS ultimately at the First of July
2019.
• The inspection session will be announced on Blackboard.
• We do not discuss exam results over the phone or by email.
• You can request a photocopy of your answers at the Student Desk up and until four
weeks after publication of the results.
• Four weeks after the results of this exam are published, the original exam is available
to you, when a declaration is signed, stating that no appeal has been made or will be
made.
• After the announcement of the exam results in OSIRIS you have six weeks within
which to lodge an appeal against your grade.
© 2019 Utrecht University School of Economics
All rights reserved. No part of this examination may be reproduced or transmitted in any form by
any electronic or mechanical means (including photocopying, recording or information storage and
retrieval) without the prior written permission of the Utrecht University School of Economics.
1
, Question 1 – Economic fluctuations (20 points)
The model below describes the economy of Simpleland.
AD = C + I + G + (X – M)
C = c0 + c (Y – T)
I = I0
G = G0
T = T0
X = X0
M = mY
AD = aggregate demand, Y = income, C = consumption, I = investment, G = government expenditure,
X = exports, M = imports, c0 = autonomous consumption, T = Taxes, c = marginal propensity to
consume, m = marginal propensity to import.
In year 1, c0 = 620, T = 250, I = 220, G = 300, X = 200, c = 0.8, m = 0.2
a. Calculate equilibrium output in year 1. What is the value of the multiplier?
2
Date examination: 24 June 2019
Duration 3 hrs; from 9.00 to 12.00
Examination: end term
Total number of pages: 15
Total number of questions: 6
Full name : -------------------------------------------------------------------------------------
Student ID Number : ------------------------------------------------------------------------
Signature : --------------------------------------------------------------------------------
Put your ID on your table for inspection.
Exam instructions
At the start of the exam
• Candidates who arrive more than 30 minutes after the time scheduled for the start of
the examination will not be permitted entry to the examination room.
During the examination
• Nobody is allowed to leave the room within the first 30 minutes after the start of the
exam.
• You are not allowed to go to the restroom unless you have permission of the
Examiner or an invigilator.
• MOBILE PHONES AND OTHER COMMUNICATION DEVICES ARE ONLY
ALLOWED WHEN SWITCHED OFF AND STORED IN CLOSED BAGS.
• It is not allowed to use any study aids such as books, readers, calculators
(pre-programmed), compilation of law decrees and lawbooks.
• Answer the exam questions on the question form (within the outlined subjects).
Results/Post-examination regulations
• The results of the examination will be published in OSIRIS ultimately at the First of July
2019.
• The inspection session will be announced on Blackboard.
• We do not discuss exam results over the phone or by email.
• You can request a photocopy of your answers at the Student Desk up and until four
weeks after publication of the results.
• Four weeks after the results of this exam are published, the original exam is available
to you, when a declaration is signed, stating that no appeal has been made or will be
made.
• After the announcement of the exam results in OSIRIS you have six weeks within
which to lodge an appeal against your grade.
© 2019 Utrecht University School of Economics
All rights reserved. No part of this examination may be reproduced or transmitted in any form by
any electronic or mechanical means (including photocopying, recording or information storage and
retrieval) without the prior written permission of the Utrecht University School of Economics.
1
, Question 1 – Economic fluctuations (20 points)
The model below describes the economy of Simpleland.
AD = C + I + G + (X – M)
C = c0 + c (Y – T)
I = I0
G = G0
T = T0
X = X0
M = mY
AD = aggregate demand, Y = income, C = consumption, I = investment, G = government expenditure,
X = exports, M = imports, c0 = autonomous consumption, T = Taxes, c = marginal propensity to
consume, m = marginal propensity to import.
In year 1, c0 = 620, T = 250, I = 220, G = 300, X = 200, c = 0.8, m = 0.2
a. Calculate equilibrium output in year 1. What is the value of the multiplier?
2
