Eco 300, Spring 2003,
Answers to Quizzes #5-9:

Quiz #5
1. expectations of a quick end to the war in Iraq
2. higher fuel costs; hangover from the previous economic boom; weak corporate spending and earnings; weak consumer spending. (Those were the main ones.)
3. unemployment
4. potential
5. marginal

Quiz #6
1. income
2. real interest rate
3. (real) exchange rate; also, net exports
4. inflation
5. tax rates; tax cuts

Quiz #7
1. Underemployed people (involuntary part-timers, "self-employed" people who were recently laid off and face little demand for their services) and discouraged job seekers (jobless people who've given up looking for work) are not counted as unemployed.
2. What is the state of the Iraqi economy (GDP, banking sector, etc.)? Data are non-existent.
3. supply
4. interest rate
5. foreign capital inflow; foreign savings

Quiz #8
1. chain-weighted
2. Alan Greenspan
3. sticky
4. unintended inventory investment; unintended inventory accumulation
5. business

Quiz #9
1. demand
2. supply
3. demand
4. supply
5. deflation