Answer key to sample problems for final

Here is the key. Again, sorry I wait so late. Someone had to remind me. If you have any questions we can talk about them in class before the test.

1-C, 2-B, 3-A, 4-B, 5-A, 6-C, 7-B,

8-A, 9-B, 10-D, 11-A, 12-A, 13-B, 14-D, 15-C,

16-D, 17-C, 18-D, 19-A, 20-A,

21-A, 22-C, 23-D, 24-X, 25-D, 26-D, 27-B,

28-A, 29-C, 30-B, 31-C, 32-C,

33.B, 34-D, 35-D, 36-C, 37-D, 38-B, 39-D,

40-A, 41-A, 42-C, 43-D, 44-B,

45-B.

Comments:

24. I don't think any of these would increase AD. All would decrease AD.

28. Both AD and AS increase. Y clearly goes up. But the price level change will depend on the short run change in AS(sr). BTW, AS(lr) will shift right too. So prices could be argued to fall. But "uncertain" change in price level is probably appropriate.

40. Fed bond sales are contractionary monetary policy. Ms shifts left. Interest rates rise.

Good luck.