Universidad Carlos III de Madrid Examen de Economía Española Junio 2007 Duración del Examen: 1 hora y media Tipo de examen: 1 NO SEPARE LAS HOJAS DEL EXAMEN. NO ABRA EL EXAMEN ANTES DE QUE SE LE INDIQUE QUE LO PUEDE HACER. Por favor, lea atentamente las siguientes instrucciones. (A) El profesor le indicará la hora tope de entrega del examen. El examen se compone de 30 preguntas tipo test. Como guía, podría dedicar unos 3 minutos a cada pregunta tipo test. (B) Salvo que se le pida lo contrario en el enunciado, señale en cada pregunta la a rmación VERDADERA. Si en una pregunta todas las respuestas son correctas, y una de ellas es "all the answers are correct", señale solo esta respuesta. (C) Utilice el reverso de las hojas para los apuntes en sucio que considere oportuno realizar. (D) Responda al examen en la plantilla de test que se adjunta con el examen. Recuerde que las preguntas incorrectamente contestadas se penalizarán un cuarto. (E) Asegúrese de escribir correctamente su INFORMACIÓN PERSONAL en la plantilla y el TIPO DE EXAMEN. 1
1. On the basis of the following data, indicate the value (rounding to integer values, i.e. without decimals), of real GDP in 2004 with 2005 as the base: GDP at current prices Growth rate of the GDP de ator 2003 780 3 percent 2004 840 4 percent 2005 900 5 percent 808. 882. 811. 874. 2. Since 1977 until 2003, regional unemployment rates are characterised by: Important di erences. None of the other answers is correct. Higher levels in regions with higher per capita incomes. Smaller di erences during recoveries. 3. With respect to the characteristics of the Spanish business cycle (1970-1994), it is possible to state that: Public Consumption is countercyclical, which indicates that it lessens the depth of recessions. The De ator is prociclical, which indicates the prevalence of shifts of the demand during that time period. Unemployment is countercyclical and, because of ring costs, is a lagging variable. Both Private Consumption and Gross Capital Formation are less volatile than GDP. 2
4. With the following national accounts data of country A and expressed in million euros, identify the correct answer: Final consumption 985 Gross Nacional Disposable Income 1800 Taxes on products 200 Taxes on production 75 Subsidies on products 150 Subsidies on production 25 Subsidies paid to the rest of the World 135 Gross Capital Formation 635 Current transfers, to the rest of the World 250 Current transfers, from the rest of the World 465 Property income payable to the rest of the World 650 Property income receivable from the rest of the World 750 Country A enjoys a positive balance for current operations of 90 million euros. The rest of the World a enjoys a positive balance for current operations of 180 million euros. Country A enjoys a positive balance for current operations of 180 million euros. The rest of the World a enjoys a positive balance for current operations of 90 million euros. 5. The entry of Spain in the European Union a ected the geographical distribution of trade in the following manner: The percentage of imports and exports to Latin America fell. All the answers are correct. The amount of trade with the European Union increased. The percentage of imports originating in the US increased. 6. Among the principal structural transformations experienced by the Spanish economy during the period 1960-2000, we have: Greater external openness and an increase in inequality in income distribution. An increase in the weight of the public sector and the industrial sector in real GDP. An increase in the weight of the agricultural sector and of the public sector in real GDP. An increase in inequality in income distribution and an increase in the weight of agriculture in real GDP. 3
7. During the second half of the 1980 s, decomposition of Spain s GDP growth indicates: Low TFP contribution, and high labour force and capital contributions. Negative TFP contribution, high labour force and capital contributions. Low TFP contribution, negative labour force contribution, and low capital contribution. High TFP, labour force, and capital contributions. 8. With respect to international comparisons in the distribution of personal income, it is possible to state that: Canada, France and Germany have experienced a clear increase in come inequality during the period 1980 and 1990. None of the other answers is correct. Spain has experienced a clear increase in come inequality during the period 1980 and 1990. The US, the United Kingdom and Spain have experienced a clear increase in come inequality during the period 1980 and 1990. 9. With respect to the evolution of the participation rate in Spain during the period 1976 to 2003, it is possible to state that: The male participation rate has fallen continuously over the time period. The female participation rate has increased signi cantly in the 25-54 age group. The male participation rate has increased signi cantly in the 16-19 age group. The female participation rate increased until the end of the 1970 s and fell thereafter. 10. An analysis of intra-industrial trade between Spain and the European Union during the period 1986-1996 indicates: A fall in trade in vertically and horizontally di erentiated goods. An increase in trade in vertically and horizontally di erentiated goods. A fall in trade in horizontally di erentiated goods and an increase in trade for vertically di erentiated goods. An increase in trade in horizontally di erentiated goods and a fall in trade for vertically di erentiated goods. 11. In 1996, the gender wage gap in Spain: Decreases with age, re ecting the fact that women acquire more job experience than men do as they become older. Decreases with education, re ecting the fact that more educated women have more bargaining power than their male counterparts. Increases with age, re ecting the fact that young women are more discriminated than older women. Increases with education, re ecting the fact that the educational mismatch is worse for women than for men. 4
12. For Spain during the period 1970-1994, among the leading series for GDP: Imports are the most volatile. The GDP de ator is the most volatile. Unemployment is the least volatile. Investment is most volatile. 13. The appreciation of the euro with respect to the dollar since 2001 is, among other factors, due to: Larger capital ows to the US. The tensions stemming from the high economic growth rates in China and India. The positive interest rate di erential between euro denominated deposits as compared to dollar denominated deposits. The reduced use of the euro compared to the dollar to carry out transactions between third countries. 14. During the period 1999-2004, Public Debt as a percentage of GDP: Increased because of a reduction in both the primary balance and in the di erential between growth and interest rates. Decreased because of an increase in both the primary balance and in the di erential between growth and interest rates. Decreased because of a reduction in both the primary balance and in the di erential between growth and interest rates. Increased because of an increase in both the primary balance and in the di erential between growth and interest rates. 15. For a country, the average cumulated growth rate in GDP per capita during four periods is 3.75 per cent. What is the level of per capita income (rounded to 1 decimal) in t, if in t+4 the level of per capita income reaches 14500 euros?: 14356.7 euros. 13525.6 euros. 12514.5 euros. 16801.1 euros. 16. The cumulated increase in the public balance of 2.7 percentage points of GDP during the period 1998-2004 was principally due to: The lowering of the interest rate burden on the debt. An increase in structural revenues larger than the increase in expenditure. The improvement in the primary structural balance. The positive contribution of the cycle. 5
17. If the employment rate goes up, for the unemployment rate to go up as well, it must be that: The participation rate increases. The unemployment rate and the employment rate can not increase simultaneously. The participation rate remains constant. The participation rate decreases. 18. For a country, given this quintile distribution of income for the years 1965 and 1990, compute (rounding a two decimals) the Gini coe cient for the two years: 1965 1990 20 4.7 6.3 40 15.4 17.8 60 31.0 34.0 80 50.6 55.5 100 100 100 0.48 and 0.42. 0.48 and 0.43. 0.49 and 0.44. 0.49 and 0.43. 19. Obtain the trade net balance for goods and services (X-M), using the following data: Expenditure on Final Consumption - Individual 415 - Collective 1000 Compensations of employees by domestic employers: - Of domestic employees 620 - Of rest of the world employees 200 Compensations of employees received from the rest of the world 150 Gross Capital Formation 405 Net Operating Surplus + Net Mixed Income 605 Fixed Capital Consumption 190 Taxes on Production 100 Subsidies on Production 50-105. 155. -155. 105. 6
20. In a rm, the payroll is distributed in the following manner: 20 workers receive 40 monetary units each, 140 workers receive 140 monetary units each, and 40 workers receive 160 monetary units each. Compute the Gini Index (rounded at two decimals): 0.12. 0.13. 0.28. 0.06. 21. According to Poterba s model, which factor will exercise a negative in uence on the demand for houses?: An increase in youth unemployment. An increase in the tax exemptions applicable when purchasing a house. A fall in interest rates. An increase in personal disposable income. 22. On the basis of the following Spanish data (expressed as a percentage of GDP), identify the correct answer: Balance of Public Administration. - 0.6 Primary structural balance 2.10 Sustainable primary balance -1.35 Interesest payments -3.20 Current scal policy is not sustainable given that the Public Administration s de cit is greater than 0.5 percent of GDP. None of the other answers is correct. Given that the primary de cit is greater than 1.35 percent of GDP, the debt to GDP ratio Hill increase. Current scal policy is sustainable given that the sustainability gap is positive and equal to 3.45. 23. Suppose that, for 2007, the annual data for the Spanish economy are: Real growth: Rate of in ation: Nominal interest rate: Primary de cit over real GDP: 4 percent 3.5 percent 4.25 percent 0.5 percent Could the public sector incur a primary de cit that year if the debt to GDP ratio had remained constant with respect to last year?: Yes, because the sustainable primary de cit is 1.56. No, because the sustainable primary de cit is -0.12. Yes, because the sustainable primary de cit is 1.52. No, because the sustainable primary de cit is -1.56. 7
24. In order to analyse welfare/inequality, income is preferable: Because data on current income is not obtained with surveys. None of the other answers is correct. Because what matters is purchasing power, not expenditure. Because consumption is distorted by taxes and transfers. 25. For the year 1996, an analysis of the revealed comparative advantages indicates that: With respect to the European Union, Spain has a comparative advantage in high technology sectors. With respect to the Rest of the World, Spain has a comparative advantage in high technology sectors. With respect to the European Union, Spain has a comparative advantage in low technology sectors. With respect to the European Union, Spain has a comparative advantage in medium technology sectors. 26. With respect to the Spanish housing market over the last twenty years, it is WRONG to state that: Housing prices have increased at a fast and persistent rate since 1997. The uctuations in house prices are principally due to migration and production costs. The building sector has been one of the principal engines of growth during the last expansionary phase. During that time period, Spain is always characterised by a higher proportion of house ownership as compared to the mean for the UE-15. 8
27. Obtain Net National Savings using the following data: Expenditure on Final Consumption 36228 Gross Operating Surplus + Mixed Income 30924 Taxes on products 1260 Subsidies on products 180 Fixed Capital Consumption 792 Compensations of employees by domestic employers: -Of domestic employees 23676 -Of rest of the world employees 450 Production taxes other than on products 5010 Production Subsidies other than on Products 1140 Property income received from the rest of the world 486 Property income payable to the rest of the world 564 Compensations of employees received from the rest of the world 222 Other current transfers: -received from the rest of the world 186 -payable to the rest of the world 120 Taxes net of subsidies payable to the Rest of the World 0 23532. 59964. 59760. 22740. 28. In the Spanish labour market, occupational gender segregation: Is in large part due to productivity di erences. None of the others answers is correct. Is in large part due to the discrimination practised by rms. Clearly falls over the last 30 years. 9
29. Imagine that the European Central Bank announces an unexpected increase in interest rates. Using the model seen in class, it is possible to state that: The euro will de nitely appreciate against the dollar if US interest rates also increase, while the rest of economic conditions remain constant. The euro will de nitely depreciate against the dollar if US interest do not change, while the rest of economic conditions remain constant. The euro will de nitely depreciate against the dollar if US interest rates also increase, while the rest of economic conditions remain constant. The euro will de nitely appreciate against the dollar if US interest do not change, while the rest of economic conditions remain constant. 30. With respect to regional convergence in Spain during the period 1955-1999, it is possible to state that: There has been beta convergence in per capita GDP because all the regions whose initial GDP per capita was higher experienced growth rates in GDP per capita lower than the mean. There has been beta convergence in per capita GDP because, in general, the regions whose initial GDP per capita was lower experienced growth rates in GDP per capita lower than the mean. There has been beta convergence in per capita GDP because, in general, the regions whose initial GDP per capita was higher experienced growth rates in GDP per capita lower than the mean. There has been beta convergence in per capita GDP because all the regions whose initial GDP per capita was lower experienced growth rates in GDP per capita lower than the mean. 10