Weekly Review Quiz As of 2008-06-19 Economics: Macro

Weekly Review Quiz as of 2008-06-19
Economics: Macro

Fed Mood Tilts Away From Rate Increase
by Sudeep Reddy
06/17/2008

1. The chance of a Fed rate hike in August will most likely increase if

a) growth slows further.
* b) growth picks up and inflation rises.
c) growth slows and inflation falls.
d) growth picks up and inflation falls.
e) inflation falls.

2. The Fed believes that

* a) neither underlying inflation nor long-term inflation expectations have reached a danger point.
b) underlying inflation has reached a danger point but long-term inflation expectations are under control.
c) long-term inflation expectations have reached a danger point but underlying inflation is at the low end of the Fed's comfort zone.
d) both underlying inflation and long-term inflation expectations are out of control.
e) both underlying inflation and long-term inflation expectations are at the low end of the Fed's comfort zone.

Stung by Soaring Transport Costs, Factories Bring Jobs Home Again
by Timothy Aeppel
06/13/2008

3. Higher transportation costs are causing

a) some U.S. manufactures to cancel plans to move manufacturing overseas which has led to an increase in manufacturing jobs this year.
* b) some U.S. manufactures to cancel plans to move manufacturing overseas but manufacturing jobs have nonetheless declined so far this year.
c) foreign manufacturers to flee the U.S.
d) U.S. manufacturers of high-valued products to curtail production.
e) U.S. manufacturers of low-valued products to increase production.

Dollar, Stocks Stake Out Higher Ground
by Joanna Slater
06/13/2008

4. The dollar is most likely to rise in value against the euro when currency traders believe

* a) the Fed will raise rates and the ECB will leave rates unchanged.
b) both the Fed and the ECB will leave rates unchanged.
c) housing prices in the U.S. will fall relative to the overall price level.
d) the ECB will raise rates and the Fed will leave rates unchanged.
e) both the Fed and the ECB will reduce rates by the same amount.

Fed's Words Overshadow Its Actions
by Mark Gongloff
06/19/2008

5. The government's effort to boost consumer spending looks a bit like the New York dating scene:

a) expensive and yielding lasting results.
* b) expensive and not yielding very lasting results.
c) inexpensive and yielding lasting results.
d) inexpensive and not yielding very lasting results.
e) risky but likely to have a large impact.