Sample mid session exam questions.pdf

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1、Econ101Autumnsession2011SampleMidSessionExamQuestions1.NominalandrealGDPdifferinthat:a.nominalGDPreferstothequantityofgoodsandservicesproduceddomesticallywhereasrealGDPreferstotheirvaluecalculatedatconstantpricesb.realGDPreferstothequantityofgoodsands

2、ervicesproduceddomesticallywhereasnominalGDPreferstotheirvaluecalculatedatcurrentpricesc.realGDPreferstothevalueofallgoodsandservicesproduceddomesticallycalculatedatconstantpriceswhereasnominalGDPreferstotheirvaluecalculatedatcurrentpricesd.realGDPisc

3、alculatedindomesticcurrencytermswhereasnominalGDPiscalculatedinUSdollartermse.realGDPtakesouttheeffectofinflationwhereasnominalGDPaccountsfortheimpactofeconomicgrowth2.InthesimplestCircularFlowofIncomemodel:a.thereareonly2sectors,householdsandfirmsb.t

4、hereareonly2markets,oneforgoodsandservicesandoneforfactorsofproductionc.spendingbyhouseholdsequalsrevenueoffirmsd.wages,rentandprofitsequalincomese.alloftheabove23.Thesupplycurveforbutterisupwardslopingfromlefttorightbecause,a.asthepriceincreases,theq

5、uantitythatfirmsarepreparedtosupplyincreasesb.asthepricedecreases,thequantitythatfirmsarepreparedtosupplyincreasesc.asthepriceincreases,supplyincreases,otherthingsbeingequald.asthepricedecreases,supplyincreases,otherthingsbeingequale.supplyanddemandar

6、einverselyrelated,andthedemandcurvehasanegativeslope,andhencethesupplycurvemustbepositivelysloped34.DasguptaandWeale(1992):“OnMeasuringtheQualityofLife”concludethat:a.percapitaincomesareagoodindicatorofaggregatewell-beingforasampleofdevelopingcountrie

7、sb.percapitaincomesareapoorindicatorofaggregatewell-beingforasampleofdevelopingcountriesc.theworstcountriesaccordingtotheBordarankhavethehighestincomesd.thebestcountriesaccordingtotheBordarankhavethelowestincomese.thereisnosignificantrelationshipbetwe

8、eneconomic,politicalandsocialindicatorsoflivingstandards(note:wehavenotcoveredthisreadingintutesthissession)45.Whichofthefollowingisaprincipleofeconomics?a.marketsareusuallyagoodwaytoorganiseeconomicactivityb.peoplerespondtoincentivesc.society