Description of the Examination

The Principles of Macroeconomics examination covers material that is usually taught in a one-semester undergraduate course in this subject. This aspect of economics deals with principles of economics that apply to an economy as a whole, particularly the general price level, output and income, and interrelations among sectors of the economy. The test places particular emphasis on the determinants of aggregate demand and aggregate supply, and on monetary and fiscal policy tools that can be used to achieve particular policy objectives. Within

this context, candidates are expected to understand basic economic concepts such as scarcity and comparative advantage and measurement concepts such as gross domestic product, consumption, investment, unemployment and inflation. Candidates are also expected to demonstrate knowledge of the institutional structure of the Federal Reserve Bank and the monetary policy tools it uses to stabilize economic fluctuations and promote long-term economic growth, as well as the tools of fiscal policy and their impacts on income, employment, price level, deficits, and interest rate. Basic understanding of foreign exchange markets, balance of payments, and effects of currency appreciation and depreciation on a country's imports and exports is also expected.

The examination contains approximately 80 questions to be answered in 90 minutes. Some of these are pretest questions that will not be scored. Any time candidates spend on tutorials and providing personal information is in addition to the actual testing time.