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ECO 550 Midterm Part 2
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ECO 550 Midterm Part 2

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Question 1 

 

The forecasting technique which attempts to forecast short-run changes and makes use of economic 

indicators known as leading, coincident or lagging indicators is known as:

 

Question 2 

 

Consumer expenditure plans is an example of a forecasting method. Which of the general categories 

best described this example?

 

Question 3 

 

Which of the following barometric indicators would be the most helpful for forecasting future sales 

for an industry?

 

Question 4 

 

The use of quarterly data to develop the forecasting model Yt = a +bYt−1 is an example of which 

forecasting technique?

 

Question 5 

 

If two alternative economic models are offered, other things equal, we would     

 

Question 6 

 

 

Smoothing techniques are a form of ____ techniques which assume that there is an underlying 

pattern to be found in the historical values of a variable that is being forecast.

 

Question 7 

 

In Chinese coastal provinces, brick housing for a fast expanding middle class is very comparable in 

size to housing in the U.S. for a family with median income of $51,000 because

 

Question 8 

 

If Ben Bernanke, Chair of the Federal Reserve Board, begins to tighten monetary policy by raising US 

interest rates next year, what is the likely impact on the value of the dollar?

 

Question 9 

 

 

Companies that reduce their margins on export products in the face of appreciation of their home 

currency may be motivated by a desire to

 

Question 10 

 

Trading partners should specialize in producing goods in accordance with comparative advantage, 

then trade and diversify in consumption because

 

Question 11 

 

If the British pound (₤) appreciates by 10% against the dollar:     

 

Question 12 

 

An appreciation of the U.S. dollar has what impact on Harley-Davidson (HD), a U.S. manufacturer of 

motorcycles?

 

Question 13 

 

The optimal currency area involves a trade-off of reducing transaction costs but the inability to use 

changes in exchange rates to help ailing regions.  If the US, Canada, and Mexico had one single 

currency (the Peso-Dollar) we would tend to see all of the following EXCEPT:

 

Question 14 

 

The isoquants for inputs that are perfect substitutes for one another consist of a series of:     

 

Question 15 

 

Which of the following is never negative?     

 

Question 16 

 

The marginal rate of technical substitution may be defined as all of the following except:     

 

Question 17 

 

If the marginal product of labor is 100 and the price of labor is 10, while the marginal product of 

capital is 200 and the price of capital is $30, then what should the firm?

 

Question 18 

 

Marginal factor cost is defined as the amount that an additional unit of the variable input adds to 

____.

 

Question 19 

 

The combinations of inputs costing a constant C dollars is called:     

 

Question 20 

 

According to the theory of cost, specialization in the use of variable resources in the short-run 

results initially in:

 

Question 21 

 

If TC = 321 + 55Q - 5Q2, then average total cost at Q = 10 is:     

 

Question 22 

 

Economies of Scope refers to situations where per unit costs are:     

 

Question 23 

 

Economies of scale exist whenever long-run average costs:     

 

Question 24 

 

What method of inventory valuation should be used for economic decision-making problems?     

 

Question 25 

 

The existence of diseconomies of scale (size) for the firm is hypothesized to result from:

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