Economics Business Cycles and Inflation Questionnaire

Description

26 attachmentsSlide 1 of 26attachment_1attachment_1attachment_2attachment_2attachment_3attachment_3attachment_4attachment_4attachment_5attachment_5attachment_6attachment_6attachment_7attachment_7attachment_8attachment_8attachment_9attachment_9attachment_10attachment_10attachment_11attachment_11attachment_12attachment_12attachment_13attachment_13attachment_14attachment_14attachment_15attachment_15attachment_16attachment_16attachment_17attachment_17attachment_18attachment_18attachment_19attachment_19attachment_20attachment_20attachment_21attachment_21attachment_22attachment_22attachment_23attachment_23attachment_24attachment_24attachment_25attachment_25attachment_26attachment_26.slider-slide > img { width: 100%; display: block; }
.slider-slide > img:focus { margin: auto; }

Unformatted Attachment Preview

Possible Questions for the
final exam in Summer 2021
ECON 1250
Coverage of this set of slides
• Questions are from the AS AD model
• Business Cycles and Inflation
• Fiscal Policy
How would a stock
market crash affect
AD?
Assume the stocks were widely held by citizens of a
country. Describe the changes in the elements or parts
of AD.
How would a stock market crash affect AD and the
short-run macroeconomic equilibrium?
• Assume the economy is at full-employment before the stock market
crash.
• Short answer – describe the effects on the economy.
• Multiple answer – choose all that apply
Cyclical
and
Structural
Deficits
• In year 1, a government had a
planned at $30 million dollar
deficit at potential GDP. Actual
GDP exceeds potential GDP at the
end of the year the government
reports a balanced budget. How is
the possible?
Cyclical and Structural Deficits
• In year 2 the government planned a balanced budget at
potential GDP, there was no structural deficit. At the end of
the year the there was a deficit of $40 million and the
economy was 3% below potential GDP.
• How would you explain this? Short answer
Calculation
– Fiscal
Policy
• A government faces a recessionary
gap of $100 billion dollars and the tax
multiplier is estimated at 1.5 and the
government multiplier is estimated
at 2.00. If the government increases
government expenditure it should
increase it by how much?
Monetary Policy
• Multiple answer question
• How will a decrease in the monetary base affect the
economy?
Monetary
Policy
The central bank is facing a tough
situation. The economy is facing a
recessionary gap and inflation is
starting to increase at a faster rate.
What is the dilemma that the
central bank faces?
Short answer
Possible Questions for the
final exam in Summer 2021
ECON 1250
Coverage of this set of slides
• Questions are from the AS AD model
• Business Cycles and Inflation
• Fiscal Policy
How would a stock
market crash affect
AD?
Assume the stocks were widely held by citizens of a
country. Describe the changes in the elements or parts
of AD.
How would a stock market crash affect AD and the
short-run macroeconomic equilibrium?
• Assume the economy is at full-employment before the stock market
crash.
• Short answer – describe the effects on the economy.
• Multiple answer – choose all that apply
Cyclical
and
Structural
Deficits
• In year 1, a government had a
planned at $30 million dollar
deficit at potential GDP. Actual
GDP exceeds potential GDP at the
end of the year the government
reports a balanced budget. How is
the possible?
Cyclical and Structural Deficits
• In year 2 the government planned a balanced budget at
potential GDP, there was no structural deficit. At the end of
the year the there was a deficit of $40 million and the
economy was 3% below potential GDP.
• How would you explain this? Short answer
Calculation
– Fiscal
Policy
• A government faces a recessionary
gap of $100 billion dollars and the tax
multiplier is estimated at 1.5 and the
government multiplier is estimated
at 2.00. If the government increases
government expenditure it should
increase it by how much?
Monetary Policy
• Multiple answer question
• How will a decrease in the monetary base affect the
economy?
Monetary
Policy
The central bank is facing a tough
situation. The economy is facing a
recessionary gap and inflation is
starting to increase at a faster rate.
What is the dilemma that the
central bank faces?
Short answer
Question 1
5 points
Save Answer
Consider the aggregate production function. Many countries are facing aging populations and that can translate into a reduction in the labour force. Consider the impact upon the
economy and choose all answers that apply.
The aggregate production function will..
A increase.
labour supply will …
B. remain unchanged.
v Potential GDP will
C. decrease
the real wage will
D. increase due to the fall in the price level
Full employment of the labour force in terms of hours will
E. shift up
Look at the following headlines and decide if it represents macroeconomics or microeconomics.
Real GDP increased by 1.4% in October
A. Neither microeconomics nor macroeconomics
Dollarama offers employee bonus but no wage increase planned
B. Both macroeconomics and microeconomics
Cineplex reports good profit in the third quarter
C. Macroeconomics
The Bank of Canada continues bond buying program
D. Microeconomics
Canada reduces its tariffs on t-shirts produced in foreign countries
Question 3
5 points Save Answer
Dec 2021: The Biden administration is proposing legislation, to protect US jobs particularly in the electric vehicle market. Canada has threatened the US with tariffs if the legistation is
passed by the US Government.
What is the purpose of Canada’s threat and how would it work?
For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).
BI U S Paragraph
Arial
V
V
10pt
:
TIL
??
v
T
OG Q
000
Conisder inflation, what can keep a cost push inflationary spiral continuing?
Answer in no more than 3 sentences.
For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).
BI VS Paragraph
Arial
10pt
Question 5
5 points
Save Answe
Governments use
fiscal policy to stabilize the business cycle, as it comes into effect as the economy changes. The idea of stabilizing the business cycle originates
economists. Parilamentary approval is needed for
fiscal policy and it is subject to lags including the
lag.
with
us
fi
PE
time
discretionary
automatic
intermediate
recognition
Classical
Keynesian
oth
re
Question 6
5 points
Save Answer
Assuming purchasing power parity holds, a drone costs 49.6 in Burnaby and the exchange rate is 0.82 US $ per Canadian dollars. The cost of the drone
in Seattle is
Please show your calculations in part 2 of the exam.
Question 7
2 points
Save Ar
This question replaces a multiple choice question.
Please answer in a whole number.
A government had planned a 20 billion dollar surplus but the surplus at the end of the year is 16 billion. The cylical deficit is
Please attach your calculation in part 2 of the test.
Question 8
Assume the foreign exchange market for Canadian dollars is in equilibrium.
The expectation that the exchange rate will fall wil………….. Choose all that apply
A. an increase in supply of dollars
B. an uncertain quantity of dollars exchanged.
C. a lower quantity of dollars exchanged
| D. an uncertain foreign exchange rate.
E. a decrease in the supply of dollars
| F. result in a lower foreign exchange rate.
U
0
Question 10
5 points
Save A
Consider the different views of the business cycles and policy responses. Match the pairs below. Please note negative scoring is in effect.
Use of fiscal and monetary policy to offset a recession is needed according to…
A Real Business cycle theorists
A decrease in labour productivity and investment is a normal result of a new
technology
B. New Keynesian economists.
c. Keynesian economists.
D. Classical economists.
Fiscal policy is not needed to offset a recession and may create disincentives for
investment and inefficiency according to …
Fiscal policy is needed to offest a recession as wages and prices are sticky
downward according to the
Question 11
5 poi
The Canadian federal government and the provincial governments run budget deficts in 2020 and in 2021 and these deficits added to the total public debt.
When considering the effects of raising income tax rates to pay off government debt, one must consider all results including…
Please choose all the answers that apply and please note negative scoring is being used.
A. a decrease in the before tax real wage
B. a decreased incentive for labour to work
c. an increase in the before tax wage rate.
D. an increased incentive for labour to work
E. a decrease in the after tax real wage.
Question 12
5 points
Save Answer
The central bank increases the monetary base by $20. The currency drain is 19 percent and the reserve ratio is 2 percent. What is the maximum amount of money that the
banking system may create after the change in the monetary base?. Please show your calculations by attaching them in part 2 of the exam.
Question 13
5 points
Save Answe
The Bank of Canada reported that inflation was 4.7% in Oct 2021 as measured by CPI.
Based on the concepts in our course, why should the Bank of Canada be concerned and what should it do to reduce inflation?
For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).
B I U ? Paragraph
Arial
10pt
V
??
%
P
O WORDS POWERED BY TINY
Question 14
5 points
If new technology makes existing capital obsolete and labour less productive, what are the effects in the loanable funds market and labour market according to some
economists? Please choose all answers that apply.
A. An increase in the real interest rate results.
OB. The quantity supplied of loanable funds decreases.
C. The supply of labour decreases.
D. A decrease in the real interest rate results.
E. The supply of labour increases
Question 15
Unanticipated inflation…
A. takes wealth away from lenders and gives it to borrowers
B. increases the real wage
c. takes real income from employers and gives it to employees
D. takes wealth from borrowers and gives it to lenders
Question 16
5 points
Save Answer
One of the positive outcomes of the COVID-19 stuggles has been the opportunity for innovation and invention as firms and organizations around the world adapted to having to
work or produce differently. In the context fo the ASIAD model, how will innovation and inventation affect the aggregate demand and aggregate supply curves.
For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).
B I U ? Paragraph
Arial
10pt
??
al
A
V
TX
4 a
P
O WORDS POWERED BY TINY
Save Answer
Question 18
5 points
Imagine a country and the economy in long-run macroeconomic equilibrium. Then there is an increase in transfer payments to the households. This will create alan
in disposable income and
, leading to alan
in
The resulting output gap will be a/an
gap. If the self correcting mechanism works, the
will
and the economy will return to long-run macroeconomic equilibrium.
consumption
increase
short-run aggregate supply
aggregate demand
recessionary
inflationary
decrease
Question 20
LAS.
Price vel
GDP
Dell
345.
es
20
1/5
B
lo
os
“ADO
700
10
30
40
50
GO
Real GDP of 2007 per year
Looking at the graph above, then answer the following 4 questions.
What point represents the short-run macroeconomic equilibrium?
What type of output gaps exists?
What is the value potential GDP?
How will the self-correcting mechanism bring the economy into long-run equilibrium?
Question 21
5 points
Save Answe
and trade with other countries. Specialization and trade allow for
Gains from trade occur when countries specialize in the production of the good or service in which they have
countries to
beyond the production possibility frontier. Trade is facilitited by markets and
Terms of trade must be
absolute advantage
money
consume
produce
comparative advantage
mutually beneficial
entrepreneurial ability
Proses
The market for apples
så
Worldprice
200
1.
1.00
Di
so
100
140
(200 kglyeca)
O of Apples
Consider the graph above, the domesitic country has
with international trade because they sell
in the production of the good. Domestic producers
? with international trade as they buy
at the world price. Domestic consumers
at the world price.
absolute advantage
win
lose
comparative advantage
less
specialization
more
–> Click Submit to complete this assessment.
Ques
Question 23
5 points
The Laffer curve suggests that a tax cut may lead to an increase in tax revenue. Briefly explain why this failed in the USA when it was attempted.
For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).
B I US Paragraph
Arial
10pt
:
??
IX
% OG Q
P
O WORDS POWERED

Purchase answer to see full
attachment

Tags:
economics

Fiscal policy

Business Cycles and Inflation

User generated content is uploaded by users for the purposes of learning and should be used following Studypool’s honor code & terms of service.