曼昆宏观经济学：期中考试示例

Eco f304L,Introduction To Macroeconomics,Summer2008

Midterm Exam

1Multiple Choice(2points each)

1.In1890,U.S.workers worked about60hours per week on average.In2003,the average was about40 hours per week.In the mean time,the real wage rate has had a5-fold increase.Based on the facts we can argue that

A.Income effect of wage increase exceeds substitution effect.

B.Substitution effect of wage increase exceeds income effect.

C.There is no income effect of wage increase.

D.There is no substitution effect of wage increase.

2.Let the production function be F(A,K,N)=AK0.3N0.7,which of the following is NOT true.

A.A is the total factor productivity.

B.Given A and K,we observe a diminishing marginal productivity of labor.

C.Given A and N,we observe a diminishing marginal productivity of capital.

D.K includes both physical capital and human capital

3.In making employment decisions,profits are maximized

A.wherever the marginal product of labor is an increasing function of employment.

B.at the level of employment where the marginal product of labor equals the nominal wage rate.

C.at the level of employment where the marginal product of labor equals the real wage rate.

D.at the level of employment where the marginal product of labor equals the average product of labor.

E.none of the above.

4.Which of the following is NOT true about Malthusian model.

A.Between the years500AD and1500AD economic growth in Europe took place at the rate of zero percent per year.

B.When output is above subsistence level,the fertility rate will increase.

C.When output is below subsistence level,the mortality rate will decrease.

D.When output is below subsistence level,the mortality rate will increase.

E.It is not a good model to describe today’s advanced economies.

5.According to the Malthusian growth model,improvements in technology.

A.allow an improvement in living standards in the short run.

B.allow an improvement in living standards in the long run.

C.cause fertility rates to increase.

D.only A and C.

E.only B and C.

6.Which of the following is a source of growth in potential GDP?

A.Growth in the labor force.

B.Growth in the capital stock.

C.Growth in labor productivity.

D.Growth in TFP.

E.All of the above.

7.An increase in technology,in Solow’s neoclassical growth model,

A.increases the steady state capital per worker.

B.increases the output per worker over the long run.

C.decrease the output per worker in the short run.

D.both A and B.

E.both A and C.

8.In a diagram of the economy’s production function that plots capital input on the horizontal axis and output on the vertical axis,an increase in the labor input is represented by

A.a movement along the production function to higher levels of capital input and output.

B.an upward shift in the production function reflecting the corresponding increase in capital productivity due to the increase in labor.

C.a downward shift in the production function due to the decline in capital’s share in producing output.

D.a movement along the production function to lower levels of capital input.

E.none of the above.

9.When the economy operates at potential GDP,

A.unemployment is equal to the natural rate.

B.the equilibrium real wage and employment level have been reached in the labor market.

C.the labor market is overheated.

D.all of the above.

E.a and b.

10.The law of motion of capital stock can be represented by K t+1=(1−δ)K t+I t+1.Suppose the current capital stock is100billion,the depreciation rateδ=0.02.What is the investment that maintains the capital stock at the current level.

A.1billion.

B.2billion.

C.10billion.

D.20billion.

11.According to the rule of70,a country growing at5percent per year doubles its GDP per capita approximately every

A.7years.

B.10years.

C.14years.

D.20years.

E.30years.

12.From2006to2007,suppose labor input had not changed,but total factor productivity has in-creased from1to1.1and capital stock has DECREASED5%what is the growth rate of output according to Solow’s formula.

A.-10percent.

B.10percent.

C.-5percent.

D.5percent.

13.Which of the following is a NOT policy to stimulate labor supply?