Question 1

In the Keynesian model,and increase in government spending financed with an increase in taxes will

Accepted Answer

A) move an economy left along its Phillips curve. 
B) shift the Phillips curve to the up. 
C) move an economy right along its Phillips curve. 
D) shift the Phillips curve down. 
E) not affect the Phillips curve. 
A) move an economy left along its Phillips curve. 
B) shift the Phillips curve to the up. 
C) move an economy right along its Phillips curve. 
D) shift the Phillips curve down. 
E) not affect the Phillips curve.

Question 2

Use the natural rate Phillips curve to analyze a change in regime at a central bank that is committed to maintaining a lower level of inflation than previous regimes.What will be the short-run impact of such a change in policy? The long-run impact?

Accepted Answer

This change in regime will lead to lower

Question 3

If the short run aggregate supply curve is flat,the Phillips curve will be

Accepted Answer

A) flat 
B) steep 
C) horizontal 
D) upward sloping 
A) flat 
B) steep 
C) horizontal 
D) upward sloping

Question 4

According to published data pertaining to unemployment rates in selected European countries,the natural rate of unemployment

Accepted Answer

A) has been rising over the past three decades. 
B) declined sharply over the last three decades. 
C) has been lower than in the U.S.in the 1990s. 
D) has not changed much over the past three decades. 
E) Both a and c 
A) has been rising over the past three decades. 
B) declined sharply over the last three decades. 
C) has been lower than in the U.S.in the 1990s. 
D) has not changed much over the past three decades. 
E) Both a and c

Question 5

The natural rate of unemployment

Accepted Answer

A) is not the same as the full employment rate of unemployment. 
B) is achieved at a zero level of unemployment. 
C) is a constant. 
D) is that unemployment rate to which the economy tends at the end of every period. 
E) none of the above. 
A) is not the same as the full employment rate of unemployment. 
B) is achieved at a zero level of unemployment. 
C) is a constant. 
D) is that unemployment rate to which the economy tends at the end of every period. 
E) none of the above.

Question 6

Policies aimed at reducing the natural rate of unemployment are referred to as

Accepted Answer

A) stabilization policies. 
B) structural policies. 
C) macroeconomic policies. 
D) labor policies. 
A) stabilization policies. 
B) structural policies. 
C) macroeconomic policies. 
D) labor policies.

Question 7

According to the theory of the natural rate of unemployment,can the policymaker "peg" the unemployment rate at some arbitrarily determined target rate? Why or why not? What is the eventual result of attempting such an action?

Accepted Answer

According to the theory of the natural r

Question 8

According to monetarists,the natural rate theory

Accepted Answer

A) denies the tradeoff between inflation and output. 
B) argues that there is a stable tradeoff between inflation and output. 
C) shows that activist policies work best. 
D) believes that the Phillips curve relationship breaks down when policymakers attempt to use it. 
A) denies the tradeoff between inflation and output. 
B) argues that there is a stable tradeoff between inflation and output. 
C) shows that activist policies work best. 
D) believes that the Phillips curve relationship breaks down when policymakers attempt to use it.

Question 9

With respect to Friedman's natural rate theory,expansionary monetary policies can

Accepted Answer

A) move output above the natural rate but leave unemployment at the natural rate in the short-run. 
B) only affect inflation and not unemployment in the long-run. 
C) leave output at its natural rate with a simultaneous decrease in the natural rate of employment. 
D) move output and employment below the natural rate. 
A) move output above the natural rate but leave unemployment at the natural rate in the short-run. 
B) only affect inflation and not unemployment in the long-run. 
C) leave output at its natural rate with a simultaneous decrease in the natural rate of employment. 
D) move output and employment below the natural rate.

Question 10

In the monetarist view,the long-run Phillips curve is

Accepted Answer

A) horizontal. 
B) downward sloping. 
C) downward sloping but steeper than the short-run curve. 
D) downward sloping but flatter than the short-run curve. 
E) none of the above. 
A) horizontal. 
B) downward sloping. 
C) downward sloping but steeper than the short-run curve. 
D) downward sloping but flatter than the short-run curve. 
E) none of the above.

Question 11

The divergent behavior of unemployment in the United States and Europe,especially in the 1990s,

Accepted Answer

A) has been ascribed to different structural characteristics of money markets in the two regions. 
B) has been attributed to different structural characteristics of labor markets in the two regions. 
C) cannot be explained for these two regions. 
D) has been explained with different demographic factors in the two regions. 
A) has been ascribed to different structural characteristics of money markets in the two regions. 
B) has been attributed to different structural characteristics of labor markets in the two regions. 
C) cannot be explained for these two regions. 
D) has been explained with different demographic factors in the two regions.

Question 12

Which of the following statements is (are)correct? There is agreement between the Keynesians and monetarists that

Accepted Answer

A) an increase in aggregate demand will increase both output and price in the short run. 
B) there is a trade-off between inflation and unemployment in the short run. 
C) in the long run,when the expected price level also has time to adjust,output will not be affected by changes in aggregate demand. 
D) All of the above 
E) None of the above 
A) an increase in aggregate demand will increase both output and price in the short run. 
B) there is a trade-off between inflation and unemployment in the short run. 
C) in the long run,when the expected price level also has time to adjust,output will not be affected by changes in aggregate demand. 
D) All of the above 
E) None of the above

Question 13

The Keynesian model

Accepted Answer

A) assumes a stable,downward sloping Phillips curve in the short run. 
B) implies a horizontal Phillips curve in the long run. 
C) shows that the Phillips curve is can be downward or upward sloping in the short run. 
D) differs from Friedman's analysis pertaining to the vertical long-run Phillips curve. 
A) assumes a stable,downward sloping Phillips curve in the short run. 
B) implies a horizontal Phillips curve in the long run. 
C) shows that the Phillips curve is can be downward or upward sloping in the short run. 
D) differs from Friedman's analysis pertaining to the vertical long-run Phillips curve.

Question 14

The rate of unemployment can be calculated by

Accepted Answer

A) simply dividing all unemployed persons by all employed persons. 
B) subtracting those employed from the total labor force to find the number of unemployed and express this number as a percent of the total labor force. 
C) subtract those unemployed from the total labor force and express this number as a percent of the total labor force. 
D) dividing all unemployed by the population. 
A) simply dividing all unemployed persons by all employed persons. 
B) subtracting those employed from the total labor force to find the number of unemployed and express this number as a percent of the total labor force. 
C) subtract those unemployed from the total labor force and express this number as a percent of the total labor force. 
D) dividing all unemployed by the population.

Question 15

In the monetarist view,a bond-financed increase in government spending would have a strong effect on real output in

Accepted Answer

A) both the short run and the long run. 
B) the short run but not the long run. 
C) the long run but not the short run. 
D) neither the short run nor the long run. 
A) both the short run and the long run. 
B) the short run but not the long run. 
C) the long run but not the short run. 
D) neither the short run nor the long run.

Question 16

According to Monetarists,the natural rate of unemployment in each country will be determined by the structural characteristics of the

Accepted Answer

A) the productive efficiency of that country. 
B) relationship between the actual price level and the expected price level. 
C) the monetary policy of that country. 
D) Both a and b 
E) All of the above 
A) the productive efficiency of that country. 
B) relationship between the actual price level and the expected price level. 
C) the monetary policy of that country. 
D) Both a and b 
E) All of the above

Question 17

In response to an increase in the population and the labor force,we would expect

Accepted Answer

A) both the short run and long run Phillips curve to shift to the right. 
B) the short run Phillips curve remains unchanged while the long run Phillips curve shifts to the right. 
C) the long run Phillips curve remains unchanged while the short run Phillips curve shifts to the right. 
D) both the short run and long run Phillips curve to shift to the left. 
E) none of the above. 
A) both the short run and long run Phillips curve to shift to the right. 
B) the short run Phillips curve remains unchanged while the long run Phillips curve shifts to the right. 
C) the long run Phillips curve remains unchanged while the short run Phillips curve shifts to the right. 
D) both the short run and long run Phillips curve to shift to the left. 
E) none of the above.

Question 18

If the government places a new tax on the firing of workers,then we would expect

Accepted Answer

A) both the short run and long run Phillips curve to shift to the right. 
B) both the short run and long run Phillips curve to shift to the left. 
C) the long run Phillips curve remains unchanged while the short run Phillips curve shifts to the right. 
D) the short run Phillips curve remains unchanged while the long run Phillips curve shifts to the right. 
E) none of the above. 
A) both the short run and long run Phillips curve to shift to the right. 
B) both the short run and long run Phillips curve to shift to the left. 
C) the long run Phillips curve remains unchanged while the short run Phillips curve shifts to the right. 
D) the short run Phillips curve remains unchanged while the long run Phillips curve shifts to the right. 
E) none of the above.

Question 19

According to the Keynesian model,a decline in the expected price level

Accepted Answer

A) will increase the inflation rate a central bank must generate to achieve a target level of unemployment. 
B) will decrease the inflation rate a central bank must generate to achieve a target level of unemployment. 
C) will not affect the inflation rate a central bank must generate to achieve a target level of unemployment. 
D) will not impact the effectiveness of monetary policy. 
A) will increase the inflation rate a central bank must generate to achieve a target level of unemployment. 
B) will decrease the inflation rate a central bank must generate to achieve a target level of unemployment. 
C) will not affect the inflation rate a central bank must generate to achieve a target level of unemployment. 
D) will not impact the effectiveness of monetary policy.

Question 20

According to the monetarists,

Accepted Answer

A) stable growth in the money supply is needed for economic stability. 
B) aggregate demand is unstable,mostly because of unstable investment demand. 
C) there is a need for fiscal policies to stabilize output. 
D) stable money growth is not needed for the economy to be stable. 
A) stable growth in the money supply is needed for economic stability. 
B) aggregate demand is unstable,mostly because of unstable investment demand. 
C) there is a need for fiscal policies to stabilize output. 
D) stable money growth is not needed for the economy to be stable.

In the Keynesian model,and increase in government spending financed with an increase in taxes will

Use the natural rate Phillips curve to analyze a change in regime at a central bank that is committed to maintaining a lower level of inflation than previous regimes.What will be the short-run impact of such a change in policy? The long-run impact?

If the short run aggregate supply curve is flat,the Phillips curve will be

According to published data pertaining to unemployment rates in selected European countries,the natural rate of unemployment

The natural rate of unemployment

Policies aimed at reducing the natural rate of unemployment are referred to as

According to the theory of the natural rate of unemployment,can the policymaker "peg" the unemployment rate at some arbitrarily determined target rate? Why or why not? What is the eventual result of attempting such an action?

According to monetarists,the natural rate theory

With respect to Friedman's natural rate theory,expansionary monetary policies can

In the monetarist view,the long-run Phillips curve is

The divergent behavior of unemployment in the United States and Europe,especially in the 1990s,

Which of the following statements is (are)correct? There is agreement between the Keynesians and monetarists that

The Keynesian model

The rate of unemployment can be calculated by

In the monetarist view,a bond-financed increase in government spending would have a strong effect on real output in

According to Monetarists,the natural rate of unemployment in each country will be determined by the structural characteristics of the

In response to an increase in the population and the labor force,we would expect

If the government places a new tax on the firing of workers,then we would expect

According to the Keynesian model,a decline in the expected price level

According to the monetarists,

Introduction

Measurement of Macroeconomic Variables

Classical Macroeconomics I: Output and Employment

Classical Macroeconomics II: Money,prices,and Interest

Keynesian System I: the Role of Aggregate Demand

Keynesian System II: Money,interest,and Income

Keynesian System III: Policy Effects in the Is-Lm Model

Keynesian System Iv: Aggregate Supply and Demand

The Monetarist Counterrevolution

New Classical Economics

Real Business Cycles and New Keynesian Economics

Macroeconomic Models:a Summary

Exchange Rates and the International Monetary System

Monetary and Fiscal Policy in the Open Economy

Money,the Banking System,and Interest Rates

Optimal Monetary Policy

Fiscal Policy

Policies for Intermediate-Run Growth

Long-Run Economic Growth: Origins of the Wealth of Nations

Filters

Exam 10: Output,inflation,and Unemployment: Alternative Views

In the Keynesian model,and increase in government spending financed with an increase in taxes will

Use the natural rate Phillips curve to analyze a change in regime at a central bank that is committed to maintaining a lower level of inflation than previous regimes.What will be the short-run impact of such a change in policy? The long-run impact?

If the short run aggregate supply curve is flat,the Phillips curve will be

According to published data pertaining to unemployment rates in selected European countries,the natural rate of unemployment

The natural rate of unemployment

Policies aimed at reducing the natural rate of unemployment are referred to as

According to the theory of the natural rate of unemployment,can the policymaker "peg" the unemployment rate at some arbitrarily determined target rate? Why or why not? What is the eventual result of attempting such an action?

According to monetarists,the natural rate theory

With respect to Friedman's natural rate theory,expansionary monetary policies can

In the monetarist view,the long-run Phillips curve is

The divergent behavior of unemployment in the United States and Europe,especially in the 1990s,

Which of the following statements is (are)correct? There is agreement between the Keynesians and monetarists that

The Keynesian model

The rate of unemployment can be calculated by

In the monetarist view,a bond-financed increase in government spending would have a strong effect on real output in

According to Monetarists,the natural rate of unemployment in each country will be determined by the structural characteristics of the

In response to an increase in the population and the labor force,we would expect

If the government places a new tax on the firing of workers,then we would expect

According to the Keynesian model,a decline in the expected price level

According to the monetarists,

Introduction

Measurement of Macroeconomic Variables

Classical Macroeconomics I: Output and Employment

Classical Macroeconomics II: Money,prices,and Interest

Keynesian System I: the Role of Aggregate Demand

Keynesian System II: Money,interest,and Income

Keynesian System III: Policy Effects in the Is-Lm Model

Keynesian System Iv: Aggregate Supply and Demand

The Monetarist Counterrevolution

New Classical Economics

Real Business Cycles and New Keynesian Economics

Macroeconomic Models:a Summary

Exchange Rates and the International Monetary System

Monetary and Fiscal Policy in the Open Economy

Money,the Banking System,and Interest Rates

Optimal Monetary Policy

Fiscal Policy

Policies for Intermediate-Run Growth

Long-Run Economic Growth: Origins of the Wealth of Nations

Filters