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ECON 1100 Global Economics Section 06 Exam 4 Summer 2011 Version D Multiple Choice Questions 2 12 points each 1 The General Theory of Employment Interest and Money was written by A William Henry Beveridge B Franklin Delano Roosevelt C John Maynard Keynes D Friedrich von Hayek 2 In response to the Great Depression the U S A transformed into a planned economy like many countries in Europe B abolished all regulation of business in an attempt to increase economic prosperity by allowing firms to make larger profits C entered a period in which economic performance remained poor for the next half century D None of the above answers are correct 3 During the 1920 s many investors in the U S purchased stock on margin This means that they A did not actually purchase the stock but were rather given the stock for free by the government B purchased stock in firms that were marginal in terms of recent economic performance i e companies which made small profits in recent years C borrowed money in order to purchase stock D made purchases at prices well above the true market value of the stock 4 was elected Prime Minister of the United Kingdom in a landslide victory in 1945 right before the end of World War II A Clement Atlee B Margaret Thatcher C Benjamin Disraeli D Winston Churchill 5 Between 1979 and 1991 the number of Britons who directly owned stock in private enterprises A increased from approximately 3 million to approximately 11 million B decreased from approximately 15 million to zero as stock ownership was made illegal C first increased from approximately 6 million to approximately 24 million by 1984 and then decreased from approximately 24 million in 1984 to approximately 2 million by 1991 D remained relatively constant at approximately 22 million 6 Johannes Semler was replaced by Ludwig Erhard as the German Director of Economic Administration in the American British Occupation Zone after referring to U S food aid to Germany as A chicken feed B dog food C ambrosia D wheat 7 During the time when Margaret Thatcher was in office Britain experienced A negative economic growth along with a decrease in income inequality B negative economic growth along with an increase in income inequality C positive economic growth along with a decrease in income inequality D positive economic growth along with an increase in income inequality 8 In the early 1930 s a Federal Excise Tax was imposed on cigarettes for the first time Under this tax if a married couple each smoked a pack a day they would effectively pay per year in taxes an amount equal to roughly of a typical family s income at this time A 7 30 15 B 43 80 5 C 80 30 2 D 182 50 3 9 The refers to the periodic but irregular fluctuation in overall macroeconomic activity which occurs over time A notion of Popular Capitalism B New Deal C Business Cycle D Stabilization Function of Government 10 According to a study published by the Federal Reserve Bank of Dallas in 2002 the annual cost to society of imposing trade restrictions to save a single American job in the canned tuna industry is approximately A 0 since the study proved that theoretically trade restrictions never impose any costs on society B 3 851 C 24 312 D 257 640 11 At the end of World War II A the industrial capacity of all European Countries was at an all time high B tens of millions of people were starving throughout Europe as part of a global food crisis C most countries in Europe essentially had full employment with an unemployment rate of roughly 0 D More than one perhaps all of the above answers is correct 12 During the Great Depression Jacob Maged of Jersey City NJ was fined 100 and put in jail for 3 months for A insider trading and investment fraud B charging 35 to press a suit C stealing food from a soup kitchen D attempting to assassinate President Franklin Delano Roosevelt Answer Questions 13 through 15 based upon the information conveyed in the graph below This graph illustrates Demand and Supply for gas in June 2011 The current free market price is 3 699 at which 2 150 units are traded price Supply a 3 999 3 699 3 249 b c d e f 0 Demand quantity 0 13 1 250 2 150 3 000 Suppose the government is concerned that gas station owners cannot make a sufficient profit when the price of gas is only 3 699 per gallon so they impose a price floor of 3 999 in this market With this price floor in place A Total Consumers Surplus will be equal to area a B Total Producers Surplus will be equal to areas b d f C exactly 3 000 units of gasoline would be bought sold D More than one perhaps all of the above answers is correct 14 If a price ceiling of 3 499 were imposed in this market then units would be traded A fewer than 1 250 B exactly 1 250 C more than 1 250 but fewer than 2 150 D exactly 2 150 15 A Deadweight Loss exactly equal to areas c e would result from imposing which of the following price controls A a price ceiling of 3 249 B a price ceiling of 3 999 C a price floor of 3 749 D More than one perhaps all of the above answers is correct 16 It has been estimated that the National Recovery Administration s Codes of Fair Competition A increased the cost of doing business by roughly 5 B increased the cost of doing business by roughly 40 C decreased the cost of doing business by roughly 10 D decreased the cost of doing business by roughly 25 17 refers to increases in the money supply intended to stimulate overall macroeconomic activity A Expansionary Fiscal Policy B Expansionary Monetary Policy C Expansionary Price Control Policy D Expansionary Tax Policy 18 The General Agreement on Tariffs and Trade A was developed at a U N conference in Havana Cuba in 1947 and initially signed by 23 countries including Australia Brazil Canada China France South Africa and Norway B provided mechanisms for establishing new import quotas and negotiating increases in the levels of existing tariffs C created a common market in Europe and would eventually evolve into the European Union D More than one perhaps all of the above answers is correct 19 The U S economy grew for an uninterrupted 10 year period from A June 1936 through June 1946 B September 1967 through September 1977 C March 1991 through March 2001 D May 2001 through May 2011 20 In an attempt to bring down inflation without slowing the economy and raising unemployment Richard Nixon A Nationalized the Commanding Heights of the U S economy in 1973 B abolished the wage and price controls implemented by Lyndon Johnson C signed into law the Elementary and


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KSU ECON 1100 - Exam 4 ECON 1100

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