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6 Written questions

6 Multiple choice questions

  1. the change in government expenditures or taxes which occurs automatically as a result of existing laws
  2. Consumption/Disposable income
  3. 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
  4. real-balances effect
    interest rate effect
    foreign purchases effect
  5. Operating costs
    Business taxes
    Technological changes
    Stock of capital goods
    Planned inventory changes
  6. Spend less, GDP will go down
    Spend more, GDP will go up

5 True/False questions

  1. 3 factors that can cause a shift in AS curveinput prices


  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. Consumptionleftward shift in the AS curve


  4. Cost-push inflationleftward shift in the AS curve


  5. Marginal Propensity to SaveChange in consumption/Disposable income


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