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Final

# ECON 203 Final: ECON 203 Midterm 2012 FallExam

Department
Economics
Course Code
ECON 203
Professor
All
Study Guide
Final

This preview shows pages 1-3. to view the full 14 pages of the document.
Econ 203: Midterm Exam Page 1 of 11
Version A
UNIVERSITY OF CALGARY
DEPARTMENT OF ECONOMICS
MIDTERM
ECONOMICS 203 (01)
VERSION“A”
Fall 2012
Instructor: Mr. Douglas McClintock
Thursday October 25, 2012
Marks: 50 Marks
Duration: 60 Minutes
NAME: ______________________________
UCID# ____________________________________
INSTRUCTIONS:
This exam consists of 50 multiple questions. For the multiple choice questions, choose
the best answer and mark your choice (in pencil) on the Scantron sheet provided.
WRITE WHICH VERSION YOU HAVE ON THE TOP OF THE SCANTRON
SHEET
Non-programmable calculators are allowed for this exam
ALL QUESTIONS SHEETS MUST BE RETURNED AT THE END OF THE
EXAM.FAILURETODOSOWILLRESULTINAN“F”FORTHEEXAM.
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Econ 203: Midterm Exam Page 2 of 11
Version A
SECTION A: MULTIPLE CHOICE (50 Marks 1 Mark each)
1. Which is the best example of a positive statement?
a. equal distribution of national income is a desirable goal of the government.
b. CNOOC’spotentialpurchaseofNexenEnergyofCalgaryisundesirablefor
c. although free trade should cause some Canadians to lose their jobs, it will
increase income for the average Canadian.
d. taxes should be lowered because a 1 percent decrease in taxes will decrease the
unemployment by rate by 0.25 percent.
e. both“c”and“d”.
2. A country's real Gross National Product measures the
a. dollar income earned by the nation's producing sector.
b. market value of national output produced by the domestic economy, measured
in base year (constant) dollars.
c. level of national income at its potential.
d. market value of all final goods and services produced by the domestic
economy, including imports.
e. income produced by Canadians regardless of where the income was generated,
measured in base year prices.
3. Which of the following represents consumption spending in the national accounts?
a. the construction of a new home in Inglewood by the Smith family.
b. the renovation of a condominium tower in downtown Calgary.
c. the purchase of a pre-owned car through eBay.
d. the purchaseofadozendonutsatTimHorton’s.
e. the price of finished inventory not yet sold to households but will be in the
future.
4. Gross domestic product does not measure?
a. the purchase of new equipment by governments.
b. household expenditures on durable goods with borrowed money.
c. the value of finished goods in inventory.
d. the purchase of an Apple computer made in China.
e. a CANDU nuclear reactor manufactured in Canada and shipped to France.
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Econ 203: Midterm Exam Page 3 of 11
Version A
5. Which of the following is an intermediate good and therefore, would be excluded
from the calculation of GDP?
a. a new set of tires sold to a car owner.
b. a new set of tires purchased by Ford to install on a new Ford Mustang.
c. 1,000 shares of stock in Apple computer.
d. a new home.
e. the government’spurchaseofanewdesktobeinstalledinanewlibrary.
6. One of the main observations by Adam Smith was that
a. a well-functioning laissez faire economy must have well defined property
rights.
b. a centrally planned economy was like the invisible hand that allocated goods
and services to its best available use.
c. self-interest and greed would be the eventual downfall of a laissez fair
economy.
d. there was a huge disparity in income between the rich and the poor and it was
the ruling class that exploited the working class.
e. productivity would increase if everyone worked for the state, which would
create a communal sense of purpose.
7. Consumption expenditure is subdivided into three categories, including
a. consumer durable good, consumer services and consumer imports.
b. consumer durables, consumer services and new homes.
c. wages, rent, and interest income.
d. consumer durable goods, consumer services and net exports.
e. consumer durable goods, consumer nondurable goods and consumer services.
8. When calculating GDP from the expenditure side, Government Spending comprises
a. only expenditures made by the federal government.
b. government expenditures on goods and services, excluding transfer payments.
c. only expenditures made on goods and not on services.
d. only expenditures made by state and local governments.
e. government expenditures on goods and services, including transfer payments.
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