PPE0054 Past Year Final 2020

Assume that you keep your savings in a saving account. You are using money as a(n) _____

• store of value.
• unit of account.
• investment good.
• medium of exchange.

Mary transfers RM500 from her saving account to her checking account. This transaction will ______

• increase both M1 and M2.
• decrease both M1 and M2.
• not change M1 and decrease M2
• increase M1 and not change M2.

Monetary policy is the setting of money supply by policymakers in Bank Negara Malaysia. Which of the following refers to the aims of implementing monetary policy in a particular country?

• To achieve lower rates of economic growth
• To maintain stability of foreign prices
• To get rid of fluctuations in productions and employment
• All of the above

Suppose that interest rates increase to a very high level, people will most likely hold _____

• less money in savings accounts and less cash.
• more money in savings accounts and less cash.
• less money in savings accounts and more cash
• more money in savings accounts and more cash.

Which of the following refers to Bank Negara Malaysia’s action to increase the money supply?

• Increase the discount rate
• Decrease in government spending
• Purchase bonds from households and firms
• None of the above

An increase in the required reserve ratio will caused the _____.

• money supply to decrease
• money supply to increase
• money supply to remain the same
• discount rate to decrease

Jeremy loses his job as an operator in Gateway Malaysia because the company relocated the operation to Singapore. This represents an example of

• frictional unemployment.
• structural unemployment.
• cyclical unemployment.
• seasonal unemployment.

During the recession of 2008-2009, cyclical unemployment increased as the recession continued. This increase in cyclical unemployment would have

• decreased the natural rate of unemployment.
• increased the natural rate of unemployment.
• had no effect on the natural rate of unemployment.
• either increased or decreased the natural rate of unemployment.

If half of all unemployed individuals suddenly gave up looking for work, the unemployment rate would ________ and the labor force participation rate would ________.

• decrease; decrease
• decrease; increase
• increase; decrease
• increase; remain the same

The table shows the number of people employed and the number of people unemployed in Canada, Japan, and the United States on the average during 1999. In 1999, the unemployment rate in ________ was the highest and the unemployment rate in ________ was the lowest.

• the United States; Japan
• Canada; the United States
• Japan; Canada
• Canada; Japan