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Iris Au
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Economics for Management Studies

MGEA06H3

Iris Au

Winter

Description

ECMA06 Midterm Winter 2007 Question 1
Question 1
1. A good estimate of Canada=s GDP per capita (per person) in 2006 (measured in current
dollars) is:
A) $4500 B) $8000 C) $12,500 D) $25,000 E) $45,000
F) $80,000 G) $125,000 H) $250,000 I) $450,000 J) $800,000
ECMA06 Midterm Winter 2011 question 9 – 10
Question 9 – Question 10: Consider 3 firms, Alpha, Beta and Omega. Omega produces $1420
worth of fertilizer. It sold $710 and $355 worth of fertilizer to Alpha and Beta respectively as
intermediate inputs and the remaining $355 to consumers. Alpha produces $1200 worth of soil
($525 sold to consumers and the remaining to Beta). Beta uses the soil brought from Alpha and
the fertilizer brought from Omega to produce $2380 worth of flowers, and it sold all the flowers
to consumers.
Question 9
What is the value of final product?
A) $1350 B) $1740 C) $2230 D) $2380 E) $2620
F) $3260 G) $3410 H) $3580 I) $3800 J) $5000
Question 10
The value of output contributed by Beta is
A) $2380 B) $2025 C) $1855 D) $1705 E) $1500
F) $1350 G) $1145 H) $1030 I) $995 J) $880 ECMA06 Midterm Winter 2009 Question 9
Question 9
Suppose that in 2008, Jocelyn earned $50000 from her work, and also received $2000 from her
mother as a gift. Her taxes totaled $8000 for the year. How would Jocelyn’s income and taxes
affect the various measures of national income?
Note: GDP = Gross domestic product and NNP = net national product.
A) GDP by $50000 NNP by $48000 personal disposable income by
$42000.
B) GDP by $50000 NNP by $50000 personal disposable income by
$42000.
C) GDP by $50000 NNP by $56000 personal disposable income by
$42000.
D) GDP by $52000 NNP by $52000 personal disposable income by
$42000.
E) GDP by $52000 NNP by $56000 personal disposable income by
$42000.
F) GDP by $50000 NNP by $50000 personal disposable income by
$44000.
G) GDP by $52000 NNP by $48000 personal disposable income by
$44000.
H) GDP by $52000 NNP by $50000 personal disposable income by
$44000.
I) GDP by $52000 NNP by $52000 personal disposable income by
$44000.
J) GDP by $52000 NNP by $56000 personal disposable income by
$44000. ECMA06 Midterm Winter 2008 Question 11 – 13
Question 11 – Question 13: You are given a relatively simple economy in which there is no
government (and hence no taxes or transfers) and no foreign sector. Prices are fixed. As in our
models discussed in class, DI is disposable income, C is consumption, and I is investment. The
economy has the following consumption and investment relationships:
C = 20 + 0.64DI
I = 250
Questions 11 through 13 concern this economy.
11. Equilibrium output in this model (rounded to the nearest unit) is:
A) 0 B) 270 C) 391 D) 422 E) 160
F) 173 G) 750 H) 694 I) 1000 J) 1200
12. The multiplier on an increase in investment in this model (rounded to the nearest thousandth)
is:
A) 0 B) 1 C) 10 D) 0.1 E) 270
F) 0.64 G) 0.36 H) 1.563 I) 2.778 J) 3.571
13. Suppose that consumers in this economy try to save more, and do so by changing the
consumption function so that it is noC = 20 + 0.54DI. The multiplier on an increase in
investment (rounded to the nearest thousandth) is now:
A) 0 B) 1 C) 20 D) 0.05 E) 0.46
F) 2.174 G) 0.54 H) 1.852 I) 0.08 J) 12.5 ECMA06 Midterm Winter 2008 Question 14 - 21
Question 14 – Question 21: The following model of the economy uses the standard symbols in
this course (Y is income or output, DI is disposable income, C is consumption, I is investment, G
is government spending, X is exports, IM is imports, T is taxes, TR is transfers, r is the interest
rate, and C/USis the exchange rate measured as the value of the Canadian dollar expressed in
terms of the U.S. dollar). Assume that prices are fixed in this model.
C = (15/16)DI
T = (1/3)Y
TR = 240 – (1/15)Y
I = 90 – 700(r –.04); r = .04
G = 510
X = 495 – 1100(E C/US 0.96); EC/US= 0.96
IM = (1/4)Y + 1100(E C/US 0.96); EC/US= 0.96
You will find it useful to know that combining the C, T, and TR functions allows us to write the
consumption function as:
C = 225 + (9/16)Y
Questions 14 through 21 concern this problem. Throughout this problem (unless specified
otherwise), r is held constant at .04 aC/USs held constant at 0.96. Note that in all cases, when
the correct answer has decimals, you should round to three decimal points.
14. Equilibrium output in this model is:
A) 1920 B) 1320 C) 907.5 D) 2346.667 E) 3017.143

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