Intermediate Macroeconomics, Class No.

2
Fall 2021
Homework 1
Due: 10/23/2020, 6pm

Multiple choice questions (1.5 points each)

1. The demand for loanable funds is equivalent to:

A) national saving.
B) private saving.
C) public saving.
D) investment.

2. The supply of loanable funds is equivalent to:

A) national saving.
B) private saving.
C) public saving.
D) investment.

3. Exogenous variables are:

A) fixed at the moment they enter the model.
B) determined within the model.
C) the outputs of the model.
D) explained by the model.

4. Endogenous variables are:

A) fixed at the moment they enter the model.
B) determined within the model.
C) the inputs of the model.
D) from outside the model.

5. The assumption of continuous market clearing means that:

A) sellers can sell all that they want at the going price.
B) buyers can buy all that they want at the going price.
C) in any given month, buyers can buy all that they want and sellers can sell all that
they want at the going price.
D) at any given instant, buyers can buy all that they want and sellers can sell all that
they want at the going price.

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6. All of the following are a stock except:
A) a consumer's wealth.
B) the government budget deficit.
C) the number of unemployed people.
D) the amount of capital in the economy.

7. All of the following are a flow except:

A) the number of new automobile purchases.
B) the number of people losing their jobs.
C) business expenditures on plant and equipment.
D) the government debt.

8. GDP is the market value of all ______ goods and services produced within an
economy in a given period of time.
A) used
B) intermediate
C) consumer
D) final

9. Assume that total output consists of 4 apples and 6 oranges and that apples cost $1
each and oranges cost $0.50 each. In this case, the value of GDP is:
A) 10 pieces of fruit.
B) $7.
C) $8.
D) $10.

10. All of the following transactions that took place in 2002 would be included in GDP
for 2002 except the purchase of a:
A) book printed in 2002, entitled The Year 3000.
B) 2001 Jeep Cherokee.
C) year 2003 calendar printed in 2002.
D) ticket to see the movie _2001._

11. Assume that a tire company sells 4 tires to an automobile company for $400, another
company sells a compact disc player for $500, and the automobile company puts all
of these items in or on a car that it sells for $20,000. In this case, the amount from
these transactions that should be counted in GDP is:
A) $20,000.
B) $20,000 less the automobile company's profit on the car.
C) $20,900.
D) $20,900 less the profits of all three companies on the items that they sold.

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12. In computing GDP,
A) expenditures on used goods are included.
B) production added to inventories is excluded.
C) the amount of production in the underground economy is imputed.
D) the value of intermediate goods is included in the market price of the final goods.

13. Nominal GDP means the value of goods and services is measured in ______ prices.
A) current
B) real
C) constant
D) average

14. Real GDP means the value of goods and services is measured in ______ prices.
A) current
B) actual
C) constant
D) average

15. The GDP deflator is equal to:

A) the ratio of nominal GDP to real GDP.
B) the ratio of real GDP to nominal GDP.
C) real GDP minus national GDP.
D) nominal GDP minus real GDP.

16. In the national income accounts, goods bought for future use are classified as which
type of expenditure?
A) services
B) investment
C) government purchases
D) net exports

17. An increase in the price of goods bought by firms and the government will show up
in:
A) the CPI but not in the GDP deflator.
B) the GDP deflator but not in the CPI.
C) both the CPI and the GDP deflator.
D) neither the CPI nor the GDP deflator.

18. An increase in the price of imported goods will show up in:

A) the CPI but not in the GDP deflator.
B) the GDP deflator but not in the CPI.
C) both the CPI and the GDP deflator.
D) neither the CPI nor the GDP deflator.

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19. Assume that the adult population of the United States is 191.6 million, total
employment is 117.6 million, and 9.4 million are unemployed. Then the
unemployment rate, as normally computed, is approximately ______ percent.
A) 4.9
B) 7.4
C) 7.9
D) 9.4

20. A farmer grows wheat and sells it to a miller for $1; the miller turns the wheat into
flour and sells it to a baker for $3; the baker uses the flour to make bread and sells
the bread for $6. The value added by the miller is:
A) $1.
B) $2.
C) $3.
D) $6.

21. A woman marries her butler. Before they were married, she paid him $20,000 per
year. He continues to wait on her as before (but as a husband rather than as a wage
earner). She earns $1,000,000 per year both before and after her marriage. The
marriage:
A) does not change GDP.
B) decreases GDP by $20,000.
C) increases GDP by $20,000.
D) increases GDP by more than $20,000.

22. The level of national income in an economy is determined by its:

A) factors of production and production function.
B) real and nominal interest rate.
C) government budget surplus or deficit.
D) rate of economic and accounting profit.

23. If bread is produced by using a constant returns to scale production function, then if
the:
A) number of workers is doubled, twice as much bread will be produced.
B) amount of equipment is doubled, twice as much bread will be produced.
C) amounts of equipment and workers are both doubled, twice as much bread will be
produced.
D) amounts of equipment and workers are both doubled, four times as much bread will
be produced.

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24.The marginal product of labor is:
A) output divided by labor input.
B) additional output produced when one additional unit of labor is added.
C) additional output produced when one additional unit of labor and one additional unit
of capital are added.
D) value of additional output when one dollar's worth of additional labor is added.

25. The real wage is the return to labor measured in:

A) dollars.
B) units of output.
C) units of labor.
D) units of capital.

26. The neoclassical theory of distribution explains the allocation of:

A) output between goods and services.
B) output among consumption, investment, and government spending.
C) income among factors of production.
D) income between saving and investment.

27. If the consumption function is given by C = 500 + 0.5(Y - T), and Y is 6,000 and T is
given by T = 200 + 0.2Y, then C equals:
A) 2,500.
B) 2,800.
C) 3,500.
D) 4,200.

28. If the consumption function is given by C = 150 + 0.85Y and Y increases by 1 unit,
then savings:
A) decreases by 0.85 unit.
B) decreases by 0.15 unit.
C) increases by 0.15 unit.
D) increases by 0.85 unit.

29. If disposable income is 4,000, consumption is 3,500, government spending is 1,000,

and tax revenues are 800, national saving is equal to:
A) 300.
B) 500.
C) 700.
D) 1,000.

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30. Assume that equilibrium GDP (Y) is 5,000. Consumption (C) is given by the
equation C = 500 + 0.6Y. No government exists. In this case, equilibrium investment
is:
A) 1,500.
B) 2,000.
C) 2,500.
D) 3,000.

31. Assume that equilibrium GDP (Y) is 5,000. Consumption is given by the equation C
= 500 + 0.6 (Y - T). Taxes (T) are equal to 600. Government spending is equal to
1,000. Investment is given by the equation I = 2,160 - 100r, where r is the real
interest rate in percent. In this case, the equilibrium real interest rate is:
A) 5 percent.
B) 8 percent.
C) 10 percent.
D) 13 percent.

32. In the classical model with fixed income an increase in the real interest rate could be
the result of a(n):
A) increase in government spending.
B) decrease in government spending.
C) decrease in desired investment.
D) increase in taxes.

33. When government spending increases and taxes are increased by an equal amount,
interest rates:
A) increase.
B) remain the same.
C) decrease.
D) can vary wildly.

34. If Y = AK0.5L0.5 and A, K, and L are all 100, the marginal product of capital is:
A) 50.
B) 100.
C) 200.
D) 1000.

35. With a Cobb-Douglas production function, the share of output going to labor:
A) decreases as the amount of labor increases.
B) increases as the amount of labor increases.
C) increases as the amount of capital increases.
D) is independent of the amount of labor.

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 36. If a neutral technological advance improves the production function, the neoclassical
theory of distribution predicts:
A) the real wage will rise and the real rental price of capital will fall.
B) both the real wage and the real rental price of capital will fall.
C) both the real wage and the real rental price of capital will rise.
D) the real wage will fall and the real rental price of capital will rise.

37. In equilibrium, total investment equals:

A) private saving.
B) public saving.
C) national saving.
D) household saving.

38. Assume that the consumption function is given by C = 200 + 0.7(Y - T), the tax
function is given by T = 100 + 0.2Y, and Y = 50K0.5L0.5, where K = 100. If L
increases from 100 to 144, then consumption increases by:
A) 560.
B) 840.
C) 1,120.
D) 2,120.

39. National saving refers to:

A) disposable income minus consumption.
B) taxes minus government spending.
C) income minus consumption minus government spending.
D) income minus investment.

40. Private saving is:

A) income minus consumption minus government spending.
B) disposable income minus consumption.
C) disposable income minus government spending.
D) taxes minus government spending.

Essay questions
1. (10 points) Chap. 2, Question #11.

2. (10 points) Chap. 3, Question #7.

3. (20 points) Find at least two data series from any reliable source. Describe the features of
the data and give your explanations. No less than 300 words.
注：请标明数据来源。你也许需要使用excel辅助画图和简单的计算。

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21秋中级宏观经济学2班答题纸
学号： 姓名： 院系专业： 学校： 分组：

Multiple choice questions (请用钢笔或铅笔将答案圆圈涂黑)

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Essay questions

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