Question 1

Suppose the supply of Malaysian rubber decreases. If U.S.producers purchase this rubber,in the United States,this would cause a

Accepted Answer

A)  rightward shift of the AD curve. 
B)  leftward shift of the AD curve. 
C)  rightward shift of the SRAS curve. 
D)  leftward shift of the SRAS curve. 
A)  rightward shift of the AD curve. 
B)  leftward shift of the AD curve. 
C)  rightward shift of the SRAS curve. 
D)  leftward shift of the SRAS curve.

Question 2

All economists agree that the worldwide benefits of globalization are likely to be greater than the worldwide costs.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is false?

Accepted Answer

A)  In recent years, the Chinese government has bought U.S. government bonds, raising interest rates in the United States. 
B)  Among the key features of globalization is the growing integration of the national economies of the world. 
C)  Globalization is associated with a movement toward more free enterprise. 
D)  It is becoming increasingly common for Americans to work for foreign companies that have offices in the United States. 
A)  In recent years, the Chinese government has bought U.S. government bonds, raising interest rates in the United States. 
B)  Among the key features of globalization is the growing integration of the national economies of the world. 
C)  Globalization is associated with a movement toward more free enterprise. 
D)  It is becoming increasingly common for Americans to work for foreign companies that have offices in the United States.

Question 4

Assuming that the increase in the value of the dollar in the foreign exchange market has a greater impact on aggregate demand than on aggregate supply,an increase in the United States budget deficit will raise Real GDP

Accepted Answer

A)  more in an open economy than in a closed economy. 
B)  more in a closed economy than in an open economy. 
C)  to the same level irrespective of whether it is a closed or an open economy. 
D)  none of the above (i.e. Real GDP will decrease) 
A)  more in an open economy than in a closed economy. 
B)  more in a closed economy than in an open economy. 
C)  to the same level irrespective of whether it is a closed or an open economy. 
D)  none of the above (i.e. Real GDP will decrease)

Question 5

Economist David Friedman has compared free international trade to

Accepted Answer

A)  the Holocaust. 
B)  the Cold War. 
C)  a technology. 
D)  a revolution. 
A)  the Holocaust. 
B)  the Cold War. 
C)  a technology. 
D)  a revolution.

Question 6

In 2000,the top 100 transnational companies produced about _____________ percent of the entire world's output,which was approximately as much as what ________________ produced that year.

Accepted Answer

A)  4.1; Japan 
B)  4.3; the United Kingdom 
C)  10.9; China 
D)  25.1; the United States 
A)  4.1; Japan 
B)  4.3; the United Kingdom 
C)  10.9; China 
D)  25.1; the United States

Question 7

If the United States goes into a recession,this tends to shift Japan's AD curve _______________ because Japan will ___________________.

Accepted Answer

A)  rightward; import less from the United States. 
B)  rightward; export less to the United States. 
C)  leftward; import less from the United States. 
D)  leftward; export less to the United States. 
A)  rightward; import less from the United States. 
B)  rightward; export less to the United States. 
C)  leftward; import less from the United States. 
D)  leftward; export less to the United States.

Question 8

When the United States is moving downward along the J-curve,its trade balance is ______________ as an immediate after-effect of a____________________ of the dollar.

Accepted Answer

A)  improving; depreciation 
B)  improving; appreciation 
C)  worsening; depreciation 
D)  worsening; appreciation 
A)  improving; depreciation 
B)  improving; appreciation 
C)  worsening; depreciation 
D)  worsening; appreciation

Question 9

Suppose the dollar appreciates in value in the foreign exchange markets. What is the impact on U.S.Real GDP?

Accepted Answer

A)  It rises because dollar appreciation shifts the U.S. AD curve leftward. 
B)  It falls because dollar appreciation shifts the U.S. SRAS curve rightward. 
C)  There is no effect on Real GDP since dollar appreciation does not affect either the U.S. AD or the U.S. SRAS curve. 
D)  It depends on whether the U.S. AD curve shifts leftward by more or less than the U.S. SRAS curve shifts rightward. 
A)  It rises because dollar appreciation shifts the U.S. AD curve leftward. 
B)  It falls because dollar appreciation shifts the U.S. SRAS curve rightward. 
C)  There is no effect on Real GDP since dollar appreciation does not affect either the U.S. AD or the U.S. SRAS curve. 
D)  It depends on whether the U.S. AD curve shifts leftward by more or less than the U.S. SRAS curve shifts rightward.

Question 10

A decrease in U.S.real interest rates causes the dollar to _________________,which tends to __________________ U.S.Real GDP.

Accepted Answer

A)  appreciate; raise 
B)  appreciate; lower 
C)  depreciate; raise 
D)  depreciate; lower 
A)  appreciate; raise 
B)  appreciate; lower 
C)  depreciate; raise 
D)  depreciate; lower

Question 11

Computers and the Internet make it possible for people to communicate with others over long distances,reducing the probability that people will trade with one another.

Accepted Answer

A) True 
 B)False

Question 12

Expansionary monetary policy _______________ Real GDP ______________ in an open economy than in a closed economy.

Accepted Answer

A)  raises; more 
B)  raises; less 
C)  lowers; more 
D)  lowers; less 
A)  raises; more 
B)  raises; less 
C)  lowers; more 
D)  lowers; less

Question 13

Two of the variables used to construct the KOF Swiss Economic Institute's economic globalization index are _______________ as a percentage of GDP,and tariff rates (the ______________ the tariff rate,the _____________ degree of economic globalization).

Accepted Answer

A)  public debt; higher; lower 
B)  trade; higher; lower 
C)  trade; higher; higher 
D)  budget deficits; lower; higher 
A)  public debt; higher; lower 
B)  trade; higher; lower 
C)  trade; higher; higher 
D)  budget deficits; lower; higher

Question 14

Which of the following will lead to a leftward shift in the U.S.SRAS curve?

Accepted Answer

A)  a decrease in foreign input prices 
B)  an appreciation of the dollar 
C)  a depreciation of the dollar 
D)  a and b 
E)  none of the above 
A)  a decrease in foreign input prices 
B)  an appreciation of the dollar 
C)  a depreciation of the dollar 
D)  a and b 
E)  none of the above

Question 15

A decrease in Japanese real interest rates causes the dollar to _____________ which tends to _______________ U.S.Real GDP.

Accepted Answer

A)  appreciate; raise 
B)  appreciate; lower 
C)  depreciate; raise 
D)  depreciate; lower 
A)  appreciate; raise 
B)  appreciate; lower 
C)  depreciate; raise 
D)  depreciate; lower

Question 16

Higher real interest rates in the United States (relative to foreign real interest rates)will lead to a(n)_____________________ of the dollar,a ____________ shift of the U.S.AD curve and a _________________ shift of the U.S.SRAS curve.

Accepted Answer

A)  appreciation; rightward; leftward 
B)  appreciation; leftward; rightward 
C)  depreciation ; rightward; leftward 
D)  depreciation; leftward; rightward 
E)  appreciation; rightward; rightward 
A)  appreciation; rightward; leftward 
B)  appreciation; leftward; rightward 
C)  depreciation ; rightward; leftward 
D)  depreciation; leftward; rightward 
E)  appreciation; rightward; rightward

Question 17

Suppose United States net exports are -$50 billion. Then the dollar depreciates. In the short run,the United States may move downward along the J-curve,with net exports _________ and the AD curve shifting to the _______________.

Accepted Answer

A)  coming closer to zero; left 
B)  coming closer to zero; right 
C)  moving further from zero; left 
D)  moving further from zero; right 
A)  coming closer to zero; left 
B)  coming closer to zero; right 
C)  moving further from zero; left 
D)  moving further from zero; right

Question 18

When the United States moves upward along the J-curve,it is because a depreciation of the dollar is having the _____________ effect of _____________ the number of dollars spent on imports.

Accepted Answer

A)  long-run; increasing 
B)  long-run; reducing 
C)  short-run; increasing 
D)  short-run; reducing 
A)  long-run; increasing 
B)  long-run; reducing 
C)  short-run; increasing 
D)  short-run; reducing

Question 19

According to the KOF Swiss Economic Institute's globalization indices for the world,globalization

Accepted Answer

A)  has been on a downward trend. 
B)  has been constant since 1970. 
C)  was on an upward trend in the 1970s and 1980s, but has more recently been on a downward trend. 
D)  has been on an upward trend. 
A)  has been on a downward trend. 
B)  has been constant since 1970. 
C)  was on an upward trend in the 1970s and 1980s, but has more recently been on a downward trend. 
D)  has been on an upward trend.

Question 20

Suppose Japanese real interest rates fall. Typically,we should expect a ____________ shift of the U.S.AD curve with a ___________________ shift in United States real interest rates.

Accepted Answer

A)  rightward; larger 
B)  rightward; smaller 
C)  leftward; larger 
D)  leftward; smaller 
A)  rightward; larger 
B)  rightward; smaller 
C)  leftward; larger 
D)  leftward; smaller

Exam 36: Globalization and International Impacts on the Economy

Suppose the supply of Malaysian rubber decreases. If U.S.producers purchase this rubber,in the United States,this would cause a

All economists agree that the worldwide benefits of globalization are likely to be greater than the worldwide costs.

Which of the following is false?

Assuming that the increase in the value of the dollar in the foreign exchange market has a greater impact on aggregate demand than on aggregate supply,an increase in the United States budget deficit will raise Real GDP

Economist David Friedman has compared free international trade to

In 2000,the top 100 transnational companies produced about _____________ percent of the entire world's output,which was approximately as much as what ________________ produced that year.

If the United States goes into a recession,this tends to shift Japan's AD curve _______________ because Japan will ___________________.

When the United States is moving downward along the J-curve,its trade balance is ______________ as an immediate after-effect of a____________________ of the dollar.

Suppose the dollar appreciates in value in the foreign exchange markets. What is the impact on U.S.Real GDP?

A decrease in U.S.real interest rates causes the dollar to _________________,which tends to __________________ U.S.Real GDP.

Computers and the Internet make it possible for people to communicate with others over long distances,reducing the probability that people will trade with one another.

Expansionary monetary policy _______________ Real GDP ______________ in an open economy than in a closed economy.

Two of the variables used to construct the KOF Swiss Economic Institute's economic globalization index are _______________ as a percentage of GDP,and tariff rates (the ______________ the tariff rate,the _____________ degree of economic globalization).

Which of the following will lead to a leftward shift in the U.S.SRAS curve?

A decrease in Japanese real interest rates causes the dollar to _____________ which tends to _______________ U.S.Real GDP.

Higher real interest rates in the United States (relative to foreign real interest rates)will lead to a(n)_____________________ of the dollar,a ____________ shift of the U.S.AD curve and a _________________ shift of the U.S.SRAS curve.

Suppose United States net exports are -$50 billion. Then the dollar depreciates. In the short run,the United States may move downward along the J-curve,with net exports _________ and the AD curve shifting to the _______________.

When the United States moves upward along the J-curve,it is because a depreciation of the dollar is having the _____________ effect of _____________ the number of dollars spent on imports.

According to the KOF Swiss Economic Institute's globalization indices for the world,globalization

Suppose Japanese real interest rates fall. Typically,we should expect a ____________ shift of the U.S.AD curve with a ___________________ shift in United States real interest rates.

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, Controlled, and Relative

Supply, Demand, and Price: Applications

Macroeconomic Measurements: Prices and Unemployment

Macroeconomic Measurements: GDP and Real GDP

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self Regulating Economy

Keynesian Macroeconomics and Economic Instability: A Critique of the Self-Regulating Economy

Fiscal Policy and the Federal Budget

Money, Banking,and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth: Resources, Technology, Ideas, and Institutions

The Financial Crisis of 2007-2009

Debates in Macroeconomics Over the Role and Effects of Government

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,Unions,and Labor

The Distribution of Income and Poverty

Interest, Rent, and Profit

Market Failure: Externalities, Public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

The Economic Case For and Against Government: Five Topics Considered

Stocks, Bonds, Futures, and Options

Agriculture: Problems, Policies, and Unintended Effects

Filters

In 2000,the top 100 transnational companies produced about _ percent of the entire world's output,which was approximately as much as what ____ produced that year.

If the United States goes into a recession,this tends to shift Japan's AD curve _ because Japan will _____.

When the United States is moving downward along the J-curve,its trade balance is as an immediate after-effect of a______ of the dollar.

A decrease in U.S.real interest rates causes the dollar to _,which tends to __ U.S.Real GDP.

Expansionary monetary policy _ Real GDP in an open economy than in a closed economy.

Two of the variables used to construct the KOF Swiss Economic Institute's economic globalization index are _ as a percentage of GDP,and tariff rates (the the tariff rate,the _ degree of economic globalization).

A decrease in Japanese real interest rates causes the dollar to _ which tends to ___ U.S.Real GDP.

Higher real interest rates in the United States (relative to foreign real interest rates)will lead to a(n)_____ of the dollar,a shift of the U.S.AD curve and a _ shift of the U.S.SRAS curve.

Suppose United States net exports are -$50 billion. Then the dollar depreciates. In the short run,the United States may move downward along the J-curve,with net exports _ and the AD curve shifting to the _______.

When the United States moves upward along the J-curve,it is because a depreciation of the dollar is having the _ effect of _ the number of dollars spent on imports.

Suppose Japanese real interest rates fall. Typically,we should expect a shift of the U.S.AD curve with a _______ shift in United States real interest rates.