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6 Written questions

6 Multiple choice questions

  1. Spend less, GDP will go down
    Spend more, GDP will go up
  2. 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
  3. Operating costs
    Business taxes
    Technological changes
    Stock of capital goods
    Planned inventory changes
  4. real-balances effect
    interest rate effect
    foreign purchases effect
  5. Wealth
    Real interest rates
  6. input prices

5 True/False questions

  1. 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


  2. Cost-push inflationleftward shift in the AS curve


  3. Marginal Propensity to SaveChange in consumption/Disposable income


  4. discretionary fiscal policydeliberate 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


  5. Average Propensity to ConsumeSavings/Disposable income


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