Examination Ill Started: Feb 20 at 11:59am Quiz Instructions Question 1 1 pts An ongoing rise in the level of prices in an entire economy is known as O inflation O deflation O shortage O surplus Question 2 1 pts Severe negative price changes, when most prices in the economy are falling, is known as O excess supply O inflation O hyperinflation O deflation Question 3 1 pts If the price index moves from 106 to 116, the rate of inflation is approximately_ %Question 4 1 pts If the price index moves from 63.6 to 100.0, the rate of inflation is approximately % Question 5 1 pts In 2000, the price index is equal to 100. The price index rises to 105.8 in 2001; 111.3 in 2002; 116.9 in 2003; and 125.3 in 2004. Using that information, the annual inflation rate O was the highest from 2000 to 2001. O was the highest from 2003 to 2004. O was the highest from 2001 to 2002. O was the highest from 2002 to 2003. Question 6 1 pts is an individual who would most likely be helped by inflation. O A homeowner paying a fixed mortgage O A consumer holding large sums of money in their checking account O A retiree who gets a pension of $2,000 per month regardless of the level of inflationO A worker earning the fixed federal minimum wage Question 7 1 pts economists generally focus on the importance of aggregate supply in determining the size of the macroeconomy over the long run. economists generally focus on the importance of aggregate demand in determining the size of the macroeconomy over the long run. O Neoclassical; Neoclassical O Keynesian; Keynesian O Keynesian; Neoclassical O Neoclassical; Keynesian Question 8 1 pts In the AD/AS model, a downward sloping line or curve is typically used to depict graphically, while a vertical line is typically used to depict graphically. O LRAS; SRAS O AD; SRAS O SRAS; LRAS O AD; LRAS Question 9 1 pts Suppose the economy is operating in the horizontal part of the Keynesian zone of the SRAS curve. Suddenly, aggregate demand decreases. As a result real GDP willand prices will O remain largely unchanged; decrease O remain largely unchanged; increase O decrease; remain largely unchanged O increase; remain largely unchanged Question 10 1 pts In the AD/AS model, the level of potential GDP indirectly, yet implicitly, illustrates O inflationary price pressure O the natural rate of unemployment O a short run dip into recession O long run economic growth Question 11 1 pts In the neoclassical zone of the SRAS curve, a leftward shift of aggregate demand will result in O largely unchanged real GDP, and lower prices. O substantially higher real GDP, and higher prices. O largely unchanged real GDP, and higher prices. O substantially higher real GDP, and lower prices.Question 12 1 pts One way that inflationary pressure is shown in the AD/AS model is O a leftward shift in the LRAS curve. O a rightward shift in the AD curve in the intermediate zone. O a leftward shift in the AD curve combined with a rightward shift in the SRAS curve in the Intermediate zone. O a rightward shift of the SRAS curve in the intermediate zone. Question 13 1 pts If you transfer money from a checking account to a money market fund, you are moving money from O time deposits to certificates of deposit O M2 to stocks O M2 to M1 O M1 to M2 Question 14 1 pts If you withdraw money from a checking account to have more cash on hand, M1 O will increase and M2 will not change. O will increase and M2 will decrease. O will decrease and M2 will not change. O will not change and M2 will not change.Question 15 1 pts Using the information in the table below, what is the value of the M1 money supply in billions of dollars? Money supply, by component Components Value (billions of dollars) Currency 200.4 Demand deposits 675.1 Savings and other liquid deposits 862.3 Time deposits 42.3 Money market fund balances 397.3 Question 16 1 pts Using the information in the table below, what is the value of the M2 money supply in billions of dollars? Money supply, by component Components Value (billions of dollars) Currency 200.2 Demand deposits 696.1 Savings and other liquid deposits 852.3 Time deposits 43.6 Money market fund balances 368.9Question 17 1 pts If the central bank sells $20,000 in bonds to a bank that has issued $540,000 in loans and is exactly meeting the reserve requirement of 10%, the money supply will decrease by Question 18 1 pts When the central bank lowers the reserve requirement on deposits, O interest rates cannot change O there will be no response in money supply O the money supply decreases O the money supply increases Question 19 1 pts If nominal GDP is 1,823 and the money supply is 817, approximately what is velocity? Question 20 1 pts Suppose that in 2019 1.00 U.S. dollar bought 2.65 Mexican pesos. Then, in 2020 1.00 U.S. dollar bought 2.56 Mexican pesos. From 2019 to 2020O the U.S. dollar appreciated relative to the Mexican peso O the Mexican peso depreciated against the U.S. dollar O neither currency appreciated or depreciated relative to the other O the U.S. dollar depreciated against the Mexican peso Question 21 4 pts Suppose the velocity is 1.8, the money supply is $1,949 billion, and the price level is 100. By how much will real GDP increase if the central bank increases the money supply by $375 billion and the price level also increases to 102? Increase of $ billion. Not saved Submit Quiz