Exam 18: Balance of Payments II: Output, Exchange Rates, and Macroeconomic Policies in the Short Run

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In 2004, retailers and exporters in the United States were happy, as were their customers from abroad, because of:

(Multiple Choice)

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Question 61

Crowding out occurs because expansionary fiscal policy:

(Multiple Choice)

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Question 62

Suppose the MPC is 0.8 in Canada and the MPC_his 0.55. If income increases by $100 million in Canada, then the increase in consumption of foreign goods will be:

(Multiple Choice)

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Question 63

A result of an exchange rate depreciation, _____ would occur as the spending patterns change in response to a change in the exchange rate.

(Multiple Choice)

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Question 64

Explain expenditure switching.

(Essay)

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Question 65

If the central bank expands the money supply under floating exchange rates, it potentially stimulates the economy in two ways, namely:

(Multiple Choice)

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Question 66

The MPC shows the relationship between:

(Multiple Choice)

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Question 67

Along the IS curve, which of the following markets are in equilibrium?

(Multiple Choice)

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Question 68

When the expected real rate of interest declines, ceteris paribus, we expect:

(Multiple Choice)

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Question 69

A major factor in changing levels of imports in an open economy is:

(Multiple Choice)

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Question 70

A Keynesian model is one in which prices are sticky:

(Multiple Choice)

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Question 71

The inside lag is the time between:

(Multiple Choice)

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Question 72

Consider the following information for a family. If the income for the family is $58,000, then an increase in income by $20,000 will result in an increase in consumption by:

(Multiple Choice)

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Question 73

When we measure the impact of exchange rate changes on a nation's trade balance, the bilateral exchange rates explain only part of the change. To assess the overall change, we need to calculate:

(Multiple Choice)

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Question 74

If the demand for money increases, what happens in the IS-LM framework?

(Multiple Choice)

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Question 75

Identify the determinants of the trade balance and give a brief intuitive explanation for each.

(Essay)

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Question 76

Under a fixed exchange rate regime, an expansionary fiscal policy would interest rates and GDP, which would cause pressure on the exchange rate, forcing the monetary authority to undertake a(n) __ monetary policy.

(Multiple Choice)

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Question 77

A shift to the left by the IS curve can be achieved by all of the following, EXCEPT a(n):

(Multiple Choice)

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Question 78

When comparing monetary and fiscal policy under fixed and floating exchange rate regimes, which of the following statements is FALSE?

(Multiple Choice)

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Question 79

The assumption of short-run price stickiness implies:

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Question 80

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Exam 18: Balance of Payments II: Output, Exchange Rates, and Macroeconomic Policies in the Short Run

In 2004, retailers and exporters in the United States were happy, as were their customers from abroad, because of:

Crowding out occurs because expansionary fiscal policy:

Suppose the MPC is 0.8 in Canada and the MPCh is 0.55. If income increases by $100 million in Canada, then the increase in consumption of foreign goods will be:

A result of an exchange rate depreciation, _____ would occur as the spending patterns change in response to a change in the exchange rate.

Explain expenditure switching.

If the central bank expands the money supply under floating exchange rates, it potentially stimulates the economy in two ways, namely:

The MPC shows the relationship between:

Along the IS curve, which of the following markets are in equilibrium?

When the expected real rate of interest declines, ceteris paribus, we expect:

A major factor in changing levels of imports in an open economy is:

A Keynesian model is one in which prices are sticky:

The inside lag is the time between:

Consider the following information for a family. If the income for the family is $58,000, then an increase in income by $20,000 will result in an increase in consumption by:

When we measure the impact of exchange rate changes on a nation's trade balance, the bilateral exchange rates explain only part of the change. To assess the overall change, we need to calculate:

If the demand for money increases, what happens in the IS-LM framework?

Identify the determinants of the trade balance and give a brief intuitive explanation for each.

Under a fixed exchange rate regime, an expansionary fiscal policy would ____ interest rates and GDP, which would cause ____ pressure on the exchange rate, forcing the monetary authority to undertake a(n) ______ monetary policy.

A shift to the left by the IS curve can be achieved by all of the following, EXCEPT a(n):

When comparing monetary and fiscal policy under fixed and floating exchange rate regimes, which of the following statements is FALSE?

The assumption of short-run price stickiness implies:

Trade in the Global Economy

Trade and Technology: The Ricardian Model

Gains and Losses From Trade in the Specific-Factors Model

Trade and Resources: the Heckscher-Ohlin Model

Movement of Labor and Capital Between Countries

Increasing Returns to Scale and Monopolistic Competition

Offshoring of Goods and Services

Import Tariffs and Quotas Under Perfect Competition

Import Tariffs and Quotas Under Imperfect Competition

Export Subsidies in Agriculture and High-Technology Industries

International Agreements: Trade, Labor, and the Environment

The Global Macroeconomy

Introduction to Exchange Rates and the Foreign Exchange Market

Exchange Rates I: the Monetary Approach in the Long Run

Exchange Rates II: the Asset Approach in the Short Run

National and International Accounts: Income, Wealth, and the Balance of Payments

Balance of Payments I: the Gains From Financial Globalization

Fixed Versus Floating: International Monetary Experience

Exchange Rate Crises: How Pegs Work and How They Break

The Euro

Topics in International Macroeconomics

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Suppose the MPC is 0.8 in Canada and the MPC_his 0.55. If income increases by $100 million in Canada, then the increase in consumption of foreign goods will be:

Under a fixed exchange rate regime, an expansionary fiscal policy would interest rates and GDP, which would cause pressure on the exchange rate, forcing the monetary authority to undertake a(n) __ monetary policy.