5 Written questions
5 Matching questions
- If the exchange rate between the dollar and foreign currencies rises (the dollar rises in value versus
foreign currencies), the price in foreign currency of U.S. products will _________ and the U.S.
aggregate demand curve will shift to the _________.
a. rise; right
b. rise; left
c. fall; right
d. fall; left
- Which of the following factors will shift the short-run aggregate supply to the right?
a. an increase in the price level
b. an increase in the wage rate
c. an increase in the cost of producing output
d. the labor force increases
- How can government policies shift the aggregate demand curve to the right?
a. by increasing personal income taxes
b. by increasing business taxes
c. by increasing government purchases
d. all of the above
- What are the three factors that cause the AD curve to shift?
- 7. Higher personal income taxes
A) increase aggregate demand.
B) increase disposable income.
C) decrease aggregate demand.
D) both b and c.
- a d. the labor force increases
- b 1. changes in government policies
2. changes in expectations of households
3. changes in foreign variables
- c c. by increasing government purchases
- d b. rise; left
- e C) decrease aggregate demand.
5 Multiple choice questions
- b. a decrease in exports and an increase in imports
- shows the relationship between the price level and the level of planned
aggregate expenditure by households, firms, and the government
- shows the relationship between the price level and the quantity of real GDP
demanded by households, firms, and the government
- government purchases
- c. a technological change
5 True/False questions
2. ________ of unemployment during ________ make it easier for workers to ________ wages.
A) High levels; a recession; accept lower
B) High levels; an expansion; negotiate higher
C) Low levels; an expansion; accept lower
D) Low levels; a recession; negotiate higher → B) decreases; decreases
Why does the short-run aggregate supply curve slope upward?
a. because profits rise when the prices of the goods and services firms sell rise more rapidly than the
prices they pay for inputs
b. because an increase in market price results in an increase in quantity supplied, as stated by the
law of supply
c. because, as the number of workers, machinery, equipment, and technological changes increase,
quantity supplied increases
d. all of the above → A) Workers and firms adjust their expectations of wages and prices downward and they accept lower wages
Describe monetary policy. → involves changes in federal taxes and purchases that are intended to achieve macroeconomic policy
. Which of the following is considered a negative supply shock?
A) increasing investment in the economy causes the capital stock to rise
B) an improvement in technology
C) a decline in wages
D) an unexpected increase in the price of natural gas → c. a technological change
Which of the following statements is true?
a. In the long run, increases in the price level result in an increase in real GDP.
b. In the long run, increases in the price level result in a decrease in real GDP.
c. In the long run, changes in the price level do not affect the level of real GDP.
d. In the long run, changes in the price level may either increase or decrease real GDP. → c. In the long run, changes in the price level do not affect the level of real GDP