Macroeconomics

Multiple Choice Questions

Bustum 26 In our analysis of the labour market, which one of the following statements is correct? Select one: O A. Through an increase in their nominal wages workers are able to increase their real wages. O B. Workers are able to determine the real wage through nominal wage bargaining. O C. A lower mark-up by firms causes a decrease in determined real wages accompanied by an increase in the natural rate of unemployment. O D. The higher the unemployment rate, the lower the targeted real wage.In the case of South Africa, a change in the R/$ nominal exchange rate between RSA and the USA from R1 = $0.40 to R1 = $0.45 implies that .. Select one: O A. fewer rands must be paid for a dollar, leading to lower exports and possibly a trade deficit. O B. more rands must be paid for a dollar, leading to higher imports and possibly a trade deficit. O C. more rands must be paid for a dollar, leading to lower exports and possibly a trade surplus. O D. fewer rands must be paid for a dollar, leading to lower imports and possibly a trade surplus.KQue From 28 This question is based on the following diagram of an IS-IM model for an open economy. LM LM Which one of the following statements is correct regarding the overall impact on net exports? Select one: O A. The lower interest rate decreases the nominal exchange rate, and the domestic currency then depreciates which decreases exports and increases imports. O B. The lower interest rate decreases the nominal exchange rate, and the domestic currency then appreciates which decreases exports and increases imports. O C. The lower interest rate increases the nominal exchange rate, and the domestic currency then appreciates which increases exports and decreases imports. O D. The lower interest rate decreases the nominal exchange rate, and the domestic currency then depreciates which increases exports and imports are indeterminate.Study the following diagram and answer the question. Which one of the following statements is INCORRECT regarding our financial market model? The diagram illustrates ... Select one: O A. a decrease in the interest rate, and since the return on bonds is lower, the demand for money will increase. O B. a negative relationship between the interest rate and the money demand. O C. a decrease in the level of output and income, and the demand for money will increase from M, to M2. O D. the following chain of events: il - passive demand for moneyt - Mot.RUs FROM 30 Study the diagram below and answer the question. In LM Yn PC 8:32 What happens to the following variables as the economy moves from a, to a2 on the IS-LM-PC model? Choose the correct statement. Select one: O A. Taxes will increase. O B. Investment spending and demand for goods will decrease. O C. Consumption spending will be the same. O D. Unemployment will decrease, and the level of output will increase