Question 1

The key factor in the ________ side of foreign currency trading is _________.

Accepted Answer

A)  fear; the differential between domestic and foreign interest rates 
B)  greed; capital loss due to a currency losing value 
C)  fear; capital loss due to a currency gaining value 
D)  fear; capital loss due to a currency losing value 
A)  fear; the differential between domestic and foreign interest rates 
B)  greed; capital loss due to a currency losing value 
C)  fear; capital loss due to a currency gaining value 
D)  fear; capital loss due to a currency losing value

Question 2

If the value of Cy, the MPC, is equal to .75 and the tax rate is equal to .1

Accepted Answer

A)  the marginal propensity to save is equal to .15. 
B)  the marginal propensity to save is equal to .65. 
C)  the marginal propensity to save is equal to .25. 
D)  the marginal propensity to save is equal to 0. 
A)  the marginal propensity to save is equal to .15. 
B)  the marginal propensity to save is equal to .65. 
C)  the marginal propensity to save is equal to .25. 
D)  the marginal propensity to save is equal to 0.

Question 3

Theory shows us that most of a change in transitory income

Accepted Answer

A)  is spent. 
B)  is paid in taxes. 
C)  is saved. 
D)  is used to buy imports. 
A)  is spent. 
B)  is paid in taxes. 
C)  is saved. 
D)  is used to buy imports.

Question 4

If the real exchange rate of the dollar__________, then U.S. exports will _________.

Accepted Answer

A)  depreciates; decrease 
B)  appreciates; increase 
C)  appreciates; decrease 
D)  depreciates; become more expensive 
A)  depreciates; decrease 
B)  appreciates; increase 
C)  appreciates; decrease 
D)  depreciates; become more expensive

Question 5

The key factor in the ________ side of foreign currency trading is _________.

Accepted Answer

A)  fear; the differential between domestic and foreign interest rates 
B)  greed; the differential between domestic and foreign interest rates 
C)  fear; capital loss due to a currency gaining value 
D)  greed; capital loss due to a currency losing value 
A)  fear; the differential between domestic and foreign interest rates 
B)  greed; the differential between domestic and foreign interest rates 
C)  fear; capital loss due to a currency gaining value 
D)  greed; capital loss due to a currency losing value

Question 6

The labor supply in an economy is

Accepted Answer

A)  the number of people in the economy. 
B)  the total adult population of the economy. 
C)  the number of workers who want to work. 
D)  the number of workers employed. 
A)  the number of people in the economy. 
B)  the total adult population of the economy. 
C)  the number of workers who want to work. 
D)  the number of workers employed.

Question 7

The benefit of hiring the last worker is

Accepted Answer

A)  his or her wage. 
B)  his or her marginal product. 
C)  the value of his or her marginal product. 
D)  his or her profit. 
A)  his or her wage. 
B)  his or her marginal product. 
C)  the value of his or her marginal product. 
D)  his or her profit.

Question 8

Transactions that add to the capital stock and increase potential output include each of the following except

Accepted Answer

A)  the purchase and installation of new business machinery and equipment. 
B)  the purchase of stocks. 
C)  the construction and purchase of a new building. 
D)  a change in business inventories. 
A)  the purchase and installation of new business machinery and equipment. 
B)  the purchase of stocks. 
C)  the construction and purchase of a new building. 
D)  a change in business inventories.

Question 9

The present value of an investment project ________ if the expected stream of profits _________.

Accepted Answer

A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  stays the same; increases 
A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  stays the same; increases

The key factor in the side of foreign currency trading is _.

If the value of C_y, the MPC, is equal to .75 and the tax rate is equal to .1

Theory shows us that most of a change in transitory income

If the real exchange rate of the dollar__, then U.S. exports will _.

The key factor in the side of foreign currency trading is _.

The labor supply in an economy is

The benefit of hiring the last worker is

Transactions that add to the capital stock and increase potential output include each of the following except

The present value of an investment project if the expected stream of profits _.

Introduction to Macroeconomics

Measuring the Macroeconomy

Thinking Like an Economist

The Theory of Economic Growth

The Reality of Economic Growth: History and Prospect

Equilibrium in the Flexible-Price M Odel

Money, Prices, and Inflation

The Sticky-Price Income-Expenditure Framework: Consumption and the Multiplier

Investment, Net Exports, and Interest Rates: The Is Curve

The Money Market and the LM Curve

The Phillips Curve, Expectations, and Monetary Policy

Stabilization Policy

Budget Balance, National Debt, and Investment

International Economic Policy

Changes in the Macroeconomy and Changes in Macroeconomic Policy

The Future of Macroeconomics

Epilogue

Filters

Exam 6: Building Blocks of the Flexible-Price Model

The key factor in the ________ side of foreign currency trading is _________.

If the value of Cy, the MPC, is equal to .75 and the tax rate is equal to .1

Theory shows us that most of a change in transitory income

If the real exchange rate of the dollar__________, then U.S. exports will _________.

The key factor in the ________ side of foreign currency trading is _________.

The labor supply in an economy is

The benefit of hiring the last worker is

Transactions that add to the capital stock and increase potential output include each of the following except

The present value of an investment project ________ if the expected stream of profits _________.

Introduction to Macroeconomics

Measuring the Macroeconomy

Thinking Like an Economist

The Theory of Economic Growth

The Reality of Economic Growth: History and Prospect

Equilibrium in the Flexible-Price M Odel

Money, Prices, and Inflation

The Sticky-Price Income-Expenditure Framework: Consumption and the Multiplier

Investment, Net Exports, and Interest Rates: The Is Curve

The Money Market and the LM Curve

The Phillips Curve, Expectations, and Monetary Policy

Stabilization Policy

Budget Balance, National Debt, and Investment

International Economic Policy

Changes in the Macroeconomy and Changes in Macroeconomic Policy

The Future of Macroeconomics

Epilogue

Filters

The key factor in the side of foreign currency trading is _.

If the value of C_y, the MPC, is equal to .75 and the tax rate is equal to .1

If the real exchange rate of the dollar__, then U.S. exports will _.

The key factor in the side of foreign currency trading is _.

The present value of an investment project if the expected stream of profits _.