Econ 2305

Last update by Armando on 09/06/2014
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Whereas the classical model focuses on the _____________, the Keynesian model emphasizes the _____________.Answer

Answer:
long run; short run

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Suppose that anticipated inflation is 4% for the coming year with loan contracts set at 7%, expecting a 3% return after inflation. If the actual inflation rate at the end of the year is 2%, then:
creditors gain at the debtors' expense.
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If the current year's CPI is 214 and last year's CPI is 209, then the rate of inflation is:
2.4%.
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The ______ reflects only household out-of pocket costs while the ______ includes expenditures made by businesses on behalf of households.
CPI; PCE
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Johnny works in his father's bubble gum store 10 hours a week after school. His father pays him no money but buys video games for him. Johnny earns a spot on the high school football team and no longer works in his father's store. How is Johnny categorized in the unemployment figures?
Johnny is not part of the labor force.
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Dave brags to his dad that his starting salary as a computer programmer of \$45,000 is much higher than his dad's starting salary of \$28,000 some years ago. If the CPI the year Dave begins work is 180.5 and the CPI the year his dad started work was 110.8, Dave is:
wrong. Adjusting for price changes, his salary is less than his dad's salary.
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The multiplier for imports is larger than the multiplier for exports.
False
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In the simple Keynesian model, if people earn \$4 billion and they spend \$3.5 billion on consumption goods, then saving is \$0.5 billion.
True
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John Maynard Keynes was primarily concerned about the problem of unemployment.
True
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In the Keynesian model, the source of any spending increase is more important than the amount of spending.
False
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Macroeconomic equilibrium does not mean the same thing as full employment.
True
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The larger a country's marginal propensity to consume, the lower is the value of its multiplier.
False
Econ 2305
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