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Additional items test the Keynesian cross equilibrium logic, IS-LM relationships between interest rates and output, and the impact of monetary policy through open-market operations.",{"@graph":14,"@context":73},[15,34,56],{"@type":16,"itemListElement":17},"BreadcrumbList",[18,23,27,31],{"item":19,"name":20,"@type":21,"position":22},"https://docshare.wps.com","Home","ListItem",1,{"item":24,"name":25,"@type":21,"position":26},"https://docshare.wps.com/document/","Document",2,{"item":28,"name":29,"@type":21,"position":30},"https://docshare.wps.com/document/exam/","Exam",3,{"item":32,"name":10,"@type":21,"position":33},"https://docshare.wps.com/document/econ-303-intermediate-macroeconomics-i-sample-questions-for-exam-3/455341/",4,{"url":32,"name":10,"@type":35,"image":36,"author":41,"headline":10,"publisher":44,"fileFormat":47,"inLanguage":8,"description":12,"dateModified":48,"datePublished":49,"encodingFormat":47,"isAccessibleForFree":50,"interactionStatistic":51},"DigitalDocument",{"url":37,"@type":38,"width":39,"height":40},"https://docshare.wps.com/thumbnails/econ-303-intermediate-macroeconomics-i-sample-questions-for-exam-3/455341.png","ImageObject",300,407,{"name":42,"@type":43},"adawds","Person",{"url":19,"name":45,"@type":46},"DocShare","Organization","application/pdf","2026-10-25","2026-09-30",true,{"@type":52,"interactionType":53,"userInteractionCount":55},"InteractionCounter",{"@type":54},"ViewAction",10,{"@type":57,"mainEntity":58},"FAQPage",[59,65,69],{"name":60,"@type":61,"acceptedAnswer":62},"What topic do these sample questions emphasize in Econ 303?","Question",{"text":63,"@type":64},"They emphasize intermediate macroeconomics topics such as the Keynesian cross, IS-LM relationships, liquidity preference, and the effects of fiscal and monetary changes on output and interest rates.","Answer",{"name":66,"@type":61,"acceptedAnswer":67},"How does liquidity preference relate interest rates to real money balances in the questions?",{"text":68,"@type":64},"The questions ask how the demand for real balances changes as interest rates change, based on the theory of liquidity preference.",{"name":70,"@type":61,"acceptedAnswer":71},"What graphical results are tested for fiscal policy and monetary policy?",{"text":72,"@type":64},"They test how taxes and government spending shift the IS curve and how an open-market purchase affects the equilibrium interest rate using liquidity preference and the market for real money balances.","https://schema.org",{"og:url":32,"og:type":75,"og:title":10,"og:site_name":45,"og:description":12},"article",{"robots":77,"canonical":32},"index,follow",{"doc_id":79,"site_id":7},455341,1790796695,{"code":4,"msg":82,"data":83},"success",[84,88,92,95,100,105,110,115,120,123,126],{"id":22,"doc_module":4,"doc_module_name":25,"category_name":85,"show_sort_weight":86,"slug":87},"Story & Novel",90,"story-novel",{"id":26,"doc_module":4,"doc_module_name":25,"category_name":89,"show_sort_weight":90,"slug":91},"Literature",80,"literature",{"id":33,"doc_module":4,"doc_module_name":25,"category_name":29,"show_sort_weight":93,"slug":94},70,"exam",{"id":96,"doc_module":4,"doc_module_name":25,"category_name":97,"show_sort_weight":98,"slug":99},5,"Comic",60,"comic",{"id":101,"doc_module":4,"doc_module_name":25,"category_name":102,"show_sort_weight":103,"slug":104},6,"Technology",50,"technology",{"id":106,"doc_module":4,"doc_module_name":25,"category_name":107,"show_sort_weight":108,"slug":109},7,"Healthcare",40,"healthcare",{"id":111,"doc_module":4,"doc_module_name":25,"category_name":112,"show_sort_weight":113,"slug":114},8,"Research & Report",30,"research-report",{"id":116,"doc_module":4,"doc_module_name":25,"category_name":117,"show_sort_weight":118,"slug":119},9,"Religion & Spirituality",20,"religion-spirituality",{"id":118,"doc_module":4,"doc_module_name":25,"category_name":121,"show_sort_weight":118,"slug":122},"World Cup","world-cup",{"id":55,"doc_module":4,"doc_module_name":25,"category_name":124,"show_sort_weight":55,"slug":125},"Lifestyle","lifestyle",{"id":127,"doc_module":4,"doc_module_name":25,"category_name":128,"show_sort_weight":96,"slug":129},19,"General","general",{"code":4,"msg":82,"data":131},{"doc_id":79,"user_id":132,"nickname":42,"user_avatar":133,"doc_module":4,"category_id":33,"category_name":29,"doc_title":10,"doc_description":12,"doc_content":134,"file_id":135,"file_url":136,"file_type":137,"file_size":138,"view_count":55,"is_deleted":4,"is_public":22,"is_downloadable":22,"audit_status":22,"page_count":55,"language":139,"language_code":8,"site_id":7,"html_lang":8,"table_of_contents":140,"faqs":141,"seo_title":142,"seo_description":12,"update_tm":143,"read_time":144},3985747872983,"https://ap-avatar.wpscdn.com/davatar_994ba38a5ba835b3df7d355c54d3ed8d","Econ 303: Intermediate Macroeconomics I  \nDr. Sauer  \nSample Questions for Exam \\#3  \n1. When firms experience unplanned inventory accumulation, they typically:  \nA) build new plants.  \nB) lay off workers and reduce production.  \nC) hire more workers and increase production.  \nD) call for more government spending.  \n2. After the Kennedy tax cut in 1964, real GDP:  \nA) fell and unemployment rose.  \nB) rose and unemployment fell.  \nC) and unemployment both rose.  \nD) and unemployment both fell.  \n3. The theory of liquidity preference implies that:  \nA) as the interest rate rises, the demand for real balances will fall.  \nB) as the interest rate rises, the demand for real balances will rise.  \nC) the interest rate will have no effect on the demand for real balances.  \nD) as the interest rate rises, income will rise.  \n4. When drawn on a graph with Y along the horizontal axis and E along the vertical axis, the line showing planned expenditures rises to the:  \nA) right with a slope less than one.  \nB) right with a slope greater than one.  \nC) left with a slope less than one.  \nD) left with a slope greater than one.  \n5. An increase in taxes shifts the IS curve, drawn with income along the horizontal axis and the interest rate along the vertical axis:  \nA) downward and to the left.  \nB) upward and to the right.  \nC) upward and to the left.  \nD) downward and to the right.  \n6. The theory of liquidity preference implies that the quantity of real money balances demanded is:  \nA) negatively related to both the interest rate and income.  \nB) positively related to both the interest rate and income.  \nC) positively related to the interest rate and negatively related to income.  \nD) negatively related to the interest rate and positively related to income.  \n7. When Paul Volcker tightened the money supply:  \nA) the inflation rate immediately fell.  \nB) nominal interest rates fell in the short run.  \nC) nominal interest rates fell in the long run.  \nD) real balances rose in the short run.  \n8. When planned expenditure is drawn on a graph as a function of income, the slope of the line is:  \nA) zero.  \nB) between zero and one.  \nC) one.  \nD) greater than one.  \n9. An increase in government spending generally shifts the IS curve, drawn with income along the horizontal axis and the interest rate along the vertical axis:  \nA) downward and to the left.  \nB) upward and to the right.  \nC) upward and to the left.  \nD) downward and to the right.  \n10. According to the analysis underlying the Keynesian cross, when planned expenditure exceeds income:  \nA) income falls.  \nB) planned expenditure falls.  \nC) unplanned inventory investment is negative.  \nD) prices rise.  \n11. In the Keynesian-cross model, as the interest rate increases, the equilibrium level of income   , whereas in the loanable funds model, as the level of income increases, the equilibrium level of the interest rate    \nA) increases; increases  \nB) increases; decreases  \nC) decreases; decreases  \nD) decreases; increases  \n12. Along an IS curve all of the following are always true except:  \nA) planned expenditures equal actual expenditures.  \nB) planned expenditures equal income.  \nC) the demand for real balances equals the supply of real balances.  \nD) demand and supply of loanable funds are equal.  \n13. According to the theory of liquidity preference, a decrease in income will   interest rates, and according to the quantity equation (assuming velocity is not constant), a decrease in interest rates will   income.  \nA) increase; increase  \nB) increase; decrease  \nC) decrease; decrease  \nD) decrease; increase  \n14. a. Graphically illustrate the impact of an open-market purchase by the Federal Reserve on the equilibrium interest rate using the theory of liquidity preference and the market for real money balances. Be sure to label: i. the axes; ii. the curves; iii. the initial equilibrium values; iv. the direction the curve shifts; and v. the terminal equilibrium values.  \nb. Explain in words w","cbCaik7JIMvhJRjb","https://ap.wps.com/l/cbCaik7JIMvhJRjb","pdf",47925,"English","# Sample Questions for Exam #3\n## Multiple-choice questions (1-21)","[{\"question\":\"What topic do these sample questions emphasize in Econ 303?\",\"answer\":\"They emphasize intermediate macroeconomics topics such as the Keynesian cross, IS-LM relationships, liquidity preference, and the effects of fiscal and monetary changes on output and interest rates.\"},{\"question\":\"How does liquidity preference relate interest rates to real money balances in the questions?\",\"answer\":\"The questions ask how the demand for real balances changes as interest rates change, based on the theory of liquidity preference.\"},{\"question\":\"What graphical results are tested for fiscal policy and monetary policy?\",\"answer\":\"They test how taxes and government spending shift the IS curve and how an open-market purchase affects the equilibrium interest rate using liquidity preference and the market for real money balances.\"}]","Econ 303 - Intermediate Macroeconomics I - Sample Questions for Exam 3 | PDF",1790742655,25]