Econ100B Macroeconomics Mid-Term 1

For True/False Questions keep in mind that being correct in the “true/false/uncertain” sense will only buy you one or two points out of the five possible. Graders are instructed that [paraphrasing] “four points may be fully correct, but not quite excellent work” in terms of one's explanation as to why the answer is true/false/uncertain. 
Thus, my advice to you: study for over the top, fully correct & comprehensive & non-rambling answers. 
I do my best to give you solid examples of those below.



True or False?

Reference: From Practice exam 1. See Page 76 (of Jones Macro Econ Crisis Ed), note that the production equation denotes aggregate production (aka, GDP) with a capital-Y, and per-capita production with a lower case 

        Solution (converting aggregate production into per-capital production)



True or False? from Fall 2010 Mid-term.

See pp. 67-71, particularly page 70  (Jones Macro Econ Crisis Update Edition)

               Solution (Marginal Product of Labor)



True or False?

Reference: From Practice exam 1. See Page 68 (of Jones Macro Econ Crisis Ed).

               Solution (Constant Returns to Scale or Not?)




True or False?

Know the rules at the top of page 54 (of Jones Macro Econ Crisis Ed), 
and be able to apply them in the example on page 54-55 – the example is
exactly this question, but with different growth rates.

               Solution (Know Growth Rate Identities)



True or False?

Assumptions
of Romer growth model, Pg 138+ (of Jones Macro Econ Crisis Update Ed), 
particularly the discussion on pages 142-143.

               Solution (Non-Rivalry of Ideas - Romer Growth Model)


See section 5.7 of Jones (Macroeconomic Crisis Update, page 109 mid-way down) for the full-credit discussion that enfolds


Just False. Solow Model in Chapter 5 leads to steady state (steady state equilibrium implies no growth),
Romer model in chapter 6 leads to long run growth.



True or False?

Read carefully pages 138-143 (of Jones Macro Econ Crisis Update Ed)

Solution (Romer Growth Model)




True or Flase?

Equations on page 45 & 49 of Jones Macro Econ Crisis Update Edition.

               Solution (Applying the "rule of 70" to growth rate problems)



True or False?

Know equations on page 45 & 49 (of Jones Macro Econ Crisis Update Ed).

You’ll almost certainly get a problem like this on your exam, just different numbers.

               Solution (Growth Rate Applications)



True or Flase?

Discussed in lecture Oct 7 2010. See pages 135 - 137 (of Jones Macro Econ Crisis Update Ed)

               Solution (Problems up Pure Competition)



True or False?

We know the rule on page 54 (of Jones Macro Econ Crisis Update Ed)

                Solution (Simple Growth Rate Calculations)


Inflation:  If the inflation rate is higher than the nominal interest rate, then the real interest rate is positive
True or False? Chapter 8, pp. 200+  (Of Jones Macro Econ, Crisis Update)
                    Solution (Application of Fisher Equation)


Quantity Theory of Money: The quantity equation implies that doubling real GDP will double the price level holding all else constant
True or False? Chapter 8, pp. 193+  (Of Jones Macro Econ, Crisis Update)
                    Solution (Application of Quantity Theory of Money)





Long Problems - each 'long problem' usually accounts for a quarter of the test's points. Worth about five true/false problems in total. Long problems center around one of the major topics in the class (the Solow Model worked through and applied, the Romer model worked through & applied, so on).

  Practice Mid-Term - Long Problem 1


Solutions
Part A - Growth Rates & Time to Double (Rule of 70)
Part B - Returns to Scale - Constant or Not?
Part C - Solow Growth Model - Solving for Steady State
Part D - Plugging in Numbers
Part E - Using the Solow Model and Diagram 

(a) Very similar to T/F problem 3 above - rules at the top of page 54 (of Jones Macro Econ Crisis Update Ed), and be able to apply them in the example on page 54-55
(b) This is very similar to T/F problem 2 above. See Page 68 (of Jones Macro Econ Crisis Ed).
(c) See page 102, particularly page 105 (of Jones Macro Econ Crisis Update Ed)
(d) Plugging in numbers. 
(e) See page 105, figure 5.2 (of Jones Macro Econ Crisis Update Ed)
~You may be asked any change to .  So be ready to draw graphs and explain. 
See pages 111-114 and pages 125-127 for this. 


  Practice Mid-Term - Long Problem 2   (also, Mid-Term 1, Long Prob 2 from 2009)


Solutions
Part A - Romer Model and Simple Growth Rates
Part B - Output per Person with Romer Growth Model, Decrease in Ideas Workers.
Part C - Combining Solow and Romer

(a) Be ready to show the work involved at pages 140-141 (Jones Macro Econ Crisis Update)
(b) See page 146, Figure 6.4, but for this, we’re twisting clockwise (as opposed to Figure 6.4, which twists counter-clockwise).
(c) see pages 158 – 163


  Winter 2010 Mid-Term Two - Long Problem 1 - Solow Model in Practice 


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