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6 Written Questions

6 Multiple Choice Questions

  1. increases in government spending or decreases in taxes or both, so that the net effect on aggregate demand is an increase in net government spending
  2. deliberate manipulation of taxes and government spending by the Congress to alter real domestic output and employment, to control inflation, and to stimulate economic growth during a particular period of time
  3. Wealth
    Borrowing
    Expectations
    Real interest rates
  4. the ratio of a change in GDP to the initial change in spending. 1/1-MPC or 1/MPS
  5. the change in government expenditures or taxes which occurs automatically as a result of existing laws
  6. Savings/Disposable income

5 True/False Questions

  1. 3 factors that can cause a shift in AS curveinput prices
    productivity
    legal-institution

          

  2. Contractionary fiscal policyan increase in taxes or decrease in government spending or both, so that the net effect on aggregate demand is a decrease in net government spending

          

  3. Instability of investmentthe ratio of a change in GDP to the initial change in spending. 1/1-MPC or 1/MPS

          

  4. 3 reasons for downward slope of AD curveinput prices
    productivity
    legal-institution

          

  5. Marginal Propensity to ConsumeChange in consumption/Disposable income

          

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