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Pastpaper 09econ

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SECTION A: MULTIPLE CHOICE QUESTIONS (35%) Answer ALL questions in this section. Choose the one alternative that best completes the statement or answers the question. Please answer questions by shading the appropriate box on the MCQ form (Multiple Choice answer sheet).

1) hich of the following is not a consequence of hyperinflation? W A) he price level grows in excess of hundreds of percentage points T per year. B) oneyʹs function as a medium of exchange is enhanced. M C) t causes an economy to suffer slow growth. I D) oney loses value so rapidly that firms and individuals stop M holding it. 2) hich of the following would you expect to lead to increases in W domestic interest rates and an appreciation of the domestic currency? A) xpansionary monetary policy e c B) ontractionary monetary policy C) xpansionary fiscal policy e D) oth B and C. B 3) eteris paribus, an unexpected increase in the current or actual rate of C inflation will cause A) he long run Phillips curve to shift leftward. t B) he short run Phillips curve to shift upward. t C) he unemployment rate to decrease (a movement along the short t run Phillips curve). D) xpectations of future inflation rates to be revised downward. e 4) he interest rate on a Treasury bill that you pay $980 for today that T matures in one year and pays $1,000 is A) percent. 2 B) percent. 4 C) percent. 3 D) percent. 1 5) he international trade effect states that T A) n increase in the domestic price level will raise net exports. a B) n increase in the domestic price level will lower net exports. a C) n increase in the domestic price level will raise exports. a D) n increase in the domestic price level will lower imports. a 6) cott is a woodworker and charges $125 an hour for his time S manufacturing custom-made wood…...

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