Money supply growth

Labour growth

Capital growth

Output growth

 

An increase in which of the following is most likely to cause an improvement in the standard of living over time?

Size of the population

Size of the labor force

Number of banks

Level of taxation

Productivity of labor

 

Macroeconomic models

Economic principles, theories or models

(A) Seek to explain and predict economic events in the hope of developing policies to correct eco­nomic problems.

(B) Identify all of the numerous detailed causes of an economic event.

(C) Develop rules of individual behavior in order to generalize and predict society's economic be­havior.

(D) All of the above.

 

Each of the following is a fundamental step that almost every successful construction of a macroeconomic model follows except

(A) The use of representative agents.

(B) A focus on the opportunity costs in undertaking agents' decisions.

(C) Careful attention to the effect of people's expectations on events.

(D) Careful attention to making the model as complicated as possible.

 

In an economic model:

(A) Exogenous variables and endogenous variables are both fixed when they enter the model.

(B) Endogenous variables and exogenous variables are both determined within the model.

(C) Endogenous variables affect exogenous variables.

(D) Exogenous variables affect endogenous variables.