Study Guides (390,000)
CA (150,000)
York (10,000)
ECON (900)
ECON 1010 (200)
All (70)
Final

ECON 1010 Study Guide - Final Guide: Monetarism, Macroeconomics, Real WagesExam


Department
Economics
Course Code
ECON 1010
Professor
All
Study Guide
Final

This preview shows pages 1-3. to view the full 14 pages of the document.
Exam
Name___________________________________
Econ 1010 M Macro Economics Winter 2013 Version C
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1)
"There can be too much of a good thing." This statement suggests that
1)
A)
certain goods and services such as education and health care are inherently desirable and
should be produced regardless of costs and benefits.
B)
a good may be produced to the point where its marginal benefit exceeds its marginal cost.
C)
a good may be produced to the point where its marginal benefit is equal to its marginal cost.
D)
a good may be produced to the point where its marginal cost exceeds its marginal benefit.
E)
choices made in self-interest cannot be applied to many economic decisions.
2)
Which one of the following people would be counted as unemployed in Canada?
2)
A)
Doris works only 5 hours a week but is looking for a full-time job.
B)
Sharon recently began looking for work after staying at home for 10 years to look after her
children.
C)
Maurice is on a 2 month vacation out of the country but is still looking for a job using the
internet.
D)
Taylor is a homemaker.
E)
Kanhaya has stopped looking for work since he was unable to find a suitable job during a
two-month search.
3)
Which of the following situations illustrates how fiscal policy can influence aggregate demand?
3)
A)
Investors, anticipating an erosion of financial wealth due to inflation, decide to save more. As
a result, aggregate demand decreases.
B)
The government reduces the goods and services tax. As a result, consumption expenditure
increases and aggregate demand increases.
C)
The exchange rate value of the Canadian dollar rises. As a result, people living near the
US-Canada border increase their imports of goods and net exports decrease.
D)
The Bank of Canada raises interest rates so people plan to buy less consumer durables. As a
result, the aggregate demand curve shifts leftward.
E)
Both A and C are examples of fiscal policy.
4)
A recessionary gap is the amount by which
4)
A)
potential GDP exceeds real GDP.
B)
real GDP exceeds potential GDP.
C)
demand will increase to achieve full employment at a given price level.
D)
the price level must adjust to achieve full employment.
E)
the supply curve must increase to achieve full employment at a given price level.
5)
A technological advance shifts
5)
A)
SAS rightward but leaves LAS unchanged.
B)
both SAS and LAS leftward.
C)
LAS rightward but leaves SAS unchanged.
D)
both SAS and AD rightward.
E)
both SAS and LAS rightward.
1

Only pages 1-3 are available for preview. Some parts have been intentionally blurred.

6)
The quantity of real GDP demanded is the sum of real consumption expenditure (C), investment
(I),
6)
A)
government expenditure (G), exports (X), and imports (M).
B)
and government expenditure (G).
C)
exports (X), and imports (M).
D)
and exports (X) minus imports (M).
E)
government expenditure (G), and exports (X) minus imports (M).
Use the information below to answer the following questions.
Fact 3.5.1
The market for coffee is initially in equilibrium. Pepsi is a substitute for coffee; cream is a complement of coffee. Consider the
market for coffee. Assume that all ceteris paribus assumptions continue to hold except for the event listed.
7)
Refer to Fact 3.5.1. An increase in the price of Pepsi, a substitute for coffee will
7)
A)
increase the price and the quantity demanded of coffee.
B)
increase the price and the quantity supplied of coffee.
C)
decrease the price and the quantity demanded of coffee.
D)
decrease the price and the quantity supplied of coffee.
E)
cause none of the above.
8)
If the price level rises, then the wealth effect leads to
8)
A)
an increase in real wealth, an increase in current consumption expenditure, and an increase in
saving.
B)
a decrease in real wealth, an increase in current consumption expenditure, and an increase in
saving.
C)
a decrease in real wealth, an increase in current consumption expenditure, and a decrease in
saving.
D)
an increase in real wealth, an increase in current consumption expenditure, and a decrease in
saving.
E)
a decrease in real wealth, a decrease in current consumption expenditure, and an increase in
saving.
9)
Full employment does not mean that there is zero unemployment because
9)
A)
of the existence of discouraged workers.
B)
of unrealistic wage expectations.
C)
some cyclical unemployment is always present.
D)
some frictional unemployment is always present.
E)
business fluctuations are inevitable.
10)
How much would the production of a kayak add to GDP if the shell costs $250, the paint costs $20,
the finisher costs $35, the manufacturer sold it to the dealer for $500, and the dealer sold it to his
customer for $800?
10)
A)
$1,300.
B)
$1,605.
C)
$500.
D)
$800.
E)
$305.
2

Only pages 1-3 are available for preview. Some parts have been intentionally blurred.

Use the table below to answer the following questions.
Table 20.2.1
Data From Eastland
Wages, salaries, and supplementary labour income 800
Farmers' income 80
Government expenditures on goods and services 240
Depreciation 240
Business investment 400
Personal income taxes net of transfer payments
Corporate profits 140
80
Indirect taxes 120
Net exports 80
Consumption expenditure 640
Interest and miscellaneous investment income 100
11)
Refer to Table 20.2.1. From the data in the table, what is total income in Eastland?
11)
A)
$1,180.
B)
$1,420.
C)
$1,360.
D)
$1,120.
E)
$1,280.
12)
Which of the following events would shift the consumption function upward?
12)
A)
an increase in disposable income
B)
an increase in wealth
C)
a decrease in expected future disposable income
D)
a decrease in disposable income
E)
a decrease in wealth
13)
In a country with a working-age population of 30 million, 18 million are employed, 2 million are
unemployed, and 2 million of the employed are working part-time, half of whom wish to work
full-time. The labour force is
13)
A)
16 million.
B)
30 million.
C)
22 million
D)
18 million.
E)
20 million.
14)
A rise in the price level ________.
14)
A)
shifts the AE curve downward and shifts the AD curve rightward
B)
shifts the AE curve downward and brings a movement up along the AD curve
C)
shifts the AD curve leftward and brings a movement down along the AE curve
D)
shifts the AD curve rightward and brings a movement up along the AE curve
E)
shifts the AE curve upward and brings a movement down along the AD curve
3
You're Reading a Preview

Unlock to view full version