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ECO 561 Finals Latest Version 2016
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  1. Because the Federal government typically provides disaster relief to farmers, many farmers do not buy crop insurance even through it is federally subsidized. This illustrates:
  2. In order for mutually beneficial trade to occur between two otherwise isolated nations:
  3. Countercyclical discretionary fiscal policy calls for:
  4. The primary gain from international trade is:
  5. Research for industrially advanced countries indicates that:
  6. Which of the following have substantially equivalent effects on a nation's volume of exports and imports
  7. Mrs. Arnold is spending all her money income by buying bottles of soda and bags of pretzels in such amounts that the marginal utility of the last bottle is 60 utils and the marginal utility of the last bag is 30 utils. The prices of soda and pretzels are $.60 per bottle and $.40 per bag respectively. It can be concluded that:
  8. Two major virtues of the market system are that it
  9. A monopolistically competitive industry combines elements of both competition and monopoly. The monopoly element results from:
  10. Assume the reserve ratio is 25 percent and Federal Reserve Banks buy $4 million of U.S. securities from the public, which deposits this amount into checking accounts. As a result of these transactions, the supply of money is:
  11. Suppose you have a limited money income and you are purchasing products A and B, whose prices happen to be the same. To maximize your utility, you should purchase A and B in such amounts that
  12. If an unintended increase in business inventories occurs at some level of GDP, then GDP
  13. Buyers will opt out of markets in which:
  14. All else equal, a large decline in the real interest rate will shift the:
  15. The term "recession" describes a situation where
  16. Macroeconomics approaches the study of economics from the viewpoint of:
  17. Normal profit is:
  18. The fact that international specialization and trade based on comparative advantage can increase world output is demonstrated by the reality that
  19.  ​The two basic markets shown by the simple circular flow model are
  20. If the Federal Reserve System buys government securities from commercial banks and the public
  21. Contractionary fiscal policy is so named because it:
  22. The business cycle depicts:
  23. As output increases, total variable cost
  24. If the prices of all goods and services rose, but the quantity produced remained unchanged, what would happen to nominal and real GDP?
  25. In the theory of comparative advantage, a good should be produced in that nation where
  26. Pure monopolists may obtain economic profits in the long run because:
  27. The simple circular flow model shows that:
  28. Which of the following will generate a demand for country X's currency in the foreign exchange market?
  29. Which of the following statements best describes the 12 Federal Reserve Banks?
  30. Why are economists concerned about inflation?



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