<p>^ you are already in UC Davis, and are taking the AP exam?</p>
<p>No, I’ll be going there in the fall, class of 2016.</p>
<p>I have to raise my score for AP Microeconomics, from 4+ to 5</p>
<p>Yo could someone help explain some of these questions to me?</p>
<ol>
<li>According to the theory of rational expectations a fully anticipated expansionary monetary policy will
A) increase potential output
B) Increase unemployment
c) have no impact on real output
d) promote the production of consumer goods over capital goods
e) result in deflation</li>
</ol>
<p>Also</p>
<p>Assets: Liabilities:
Total Reserves: 15000 Demand Deposits: $100,000
Securities: 70000
Loan: 15000</p>
<ol>
<li><p>A commercial bank is facing the conditions given above. If the reserve requirement is 12% and the bank does not sell any of its securities the maximum amount of additional lending this bank can undertake is:
a) 15,000
b) 12,000
c), 3,000
d) 1,800
e) 0</p></li>
<li><p>With an increase n investment demand in the Us, the real interest rate rises. In this situation, the most likely change in the capital stock in the US and in the international value of the dollar would be which of the following?</p></li>
</ol>
<p>-What is capital stock and why does it increase?</p>
<p>Thanks</p>
<p>whats answer for first question?</p>
<p>I think it’s C</p>
<p>ya, c is the answer for the 1st.</p>
<p>I’m taking this but feel pretty confident and it will be my last AP test yaaay!</p>
<p>C is also the answer to the second.</p>
<p>[AP</a> Microeconomics | AP* Practice Exams](<a href=“http://www.appracticeexams.com/ap-microeconomics]AP”>AP Microeconomics Review | AP Practice Exams)</p>
<p>You’re welcome lol</p>
<p>capital stock is basically the stock that individuals invest in. So with higher interest rate, all the rich europeans want to invest in capital stock in the US so it increases</p>
<p>do you guys have curve for 1990 AP Macro exam?</p>
<p>Guys, it’s much more helpful if you explain why the answer to a MC question is right. Usually, we already know what the right answer is supposed to be, but not why it’s right. That said, here’s my explanation - please correct me if anything is incorrect.</p>
<ol>
<li>Expansionary monetary policy is expected so AD is expected to increase, and thus increase the PL and rGDP. Therefore, people expect inflation, which leads to workers demanding higher wages, firms increasing prices, etc. As a result, the rGDP remains the same as before, but the PL is increased.</li>
</ol>
<p>The change can also be visualized in a SRPC. The monetary policy shifts AD and thus decreases unemployment, however, people expect inflation so the SRPC shifts to the right. Inflation increases, unemployment (and thus rGDP) remains the same.</p>
<ol>
<li>The rr is 0.12 so the bank must keep 100,000*0.12 = 12,000 in reserve. That leaves 88,000 that the bank can use somehow. The bank has already used 70,000 in securities and 15,000 in loans, so that only leaves 3,000 left to loan.</li>
</ol>
<p>Say that the US is experiencing stagflation. How would that affect the US in the foreign exchange market? I originally thought that it would decrease the demand of US dollars due to the high prices of goods in the US reducing exports, causing the dollar to depreciate, but the 2006 FRQ says that supply shifts to the left due to a fall in real income, causing the dollar to appreciate.</p>
<p>Does anyone have 2010 Released Macro exam? please share with me!</p>
<p>Does anyone have 2010 Released Macro exam? please share with me!!</p>
<p>I missed 8 from 50 Questions on 1990 AP Macroeconomics. Is that a 5 on 1990 curve?</p>
<p>Guys, what’s the best way to cram for this test?</p>
<p>
</p>
<p>Read the explanation the student in sample 1A gives to part (d). It explains this pretty well, I think: <a href=“Supporting Students from Day One to Exam Day – AP Central | College Board”>Supporting Students from Day One to Exam Day – AP Central | College Board;
<p>I like to think about it this way: stagflation increases price level and decreases real output (GDP). This also implies decreased real wages earned by people. In effect, the purchasing power of workers has gone down–stuff costs more and they have less money. So, they save it instead of spending it and putting that money into the circulating money supply where it can be traded on the FOREX market.</p>
<p>A decrease in supply of dollars will cause it to appreciate. Think about the FOREX graph and how a leftward shift of supply of dollars affects the price of dollars in terms of, in the 2006 FRQ, the yen.</p>
<p>I have a question if anyone is willing to help me 
PR on page 48 says:
Changes in the price of a good does NOT change the demand for the good, but rather the quantity demanded.</p>
<p>I don’t understand the difference between the demand/quantity demanded.</p>