Question 1

An economic contraction caused by a shift in aggregate demand remedies itself over time as the expected price level

Accepted Answer

A)  rises,shifting aggregate demand right.
B)  rises,shifting aggregate demand left.
C)  falls,shifting aggregate supply right.
D)  falls,shifting aggregate supply left.E) B) and C)
F) A) and B)

Question 2

Suppose the economy is in long-run equilibrium.If there is a sharp decline in the stock market combined with a significant increase in immigration of skilled workers,then in the short run,

Accepted Answer

A)  real GDP will rise and the price level might rise,fall,or stay the same.In the long-run,real GDP will rise and the price level might rise,fall,or stay the same.
B)  the price level will fall,and real GDP might rise,fall,or stay the same.In the long-run,real GDP and the price level will be unaffected.
C)  the price level will rise,and real GDP might rise,fall,or stay the same.In the long run,real GDP will rise and the price level will fall.
D)  the price level will fall,and real GDP might rise,fall,or stay the same.In the long run,real GDP will rise and the price level will fall.E) None of the above
F) All of the above

Question 3

The long-run aggregate supply curve shifts right if

Accepted Answer

A)  technology improves.
B)  the price level decreases.
C)  the money supply increases.
D)  All of the above are correct.E) All of the above
F) B) and D)

Question 4

When taxes increase,consumption

Accepted Answer

A)  decreases as shown by a movement to the left along a given aggregate-demand curve.
B)  decreases as shown by a shift of the aggregate demand curve to the left.
C)  increases as shown by a movement to the right along a given aggregate-demand curve.
D)  increases as shown by a shift of the aggregate demand curve to the right.E) B) and C)
F) A) and B)

Question 5

Other things the same,as the price level falls,the exchange rate rises.A rise in the exchange rate leads to a decrease in net exports.

Accepted Answer

A) True 
 B)False

Question 6

The aggregate-demand curve

Accepted Answer

A)  has a slope that is explained in the same way as the slope of the demand curve for a particular product.
B)  is vertical in the long run.
C)  shows an inverse relation between the price level and the quantity of all goods and services demanded.
D)  All of the above are correct.E) All of the above
F) B) and D)

Question 7

Figure 34-1 
-Refer to Figure 34-1.An increase in the money supply would move the economy from C to

Accepted Answer

A)  B in the short run and the long run.
B)  D in the short run and the long run.
C)  B in the short run and A in the long run.
D)  D in the short run and C in the long run.E) A) and C)
F) A) and B)

Question 8

According to classical macroeconomic theory,changes in the money supply affect

Accepted Answer

A)  real GDP and the price level.
B)  real GDP but not the price level.
C)  the price level,but not real GDP.
D)  neither the price level nor real GDP.E) A) and D)
F) All of the above

Exam 34: Aggregate Demand and Aggregate Supply

The aggregate-demand curve

Correct Answer
verified

When taxes increase,consumption

Correct Answer
verified

Suppose the economy is in long-run equilibrium.If there is a sharp decline in the stock market combined with a significant increase in immigration of skilled workers,then in the short run,

Correct Answer
verified

Figure 34-1 -Refer to Figure 34-1.An increase in the money supply would move the economy from C to

Correct Answer
verified

Other things the same,as the price level falls,the exchange rate rises.A rise in the exchange rate leads to a decrease in net exports.

Correct Answer
verified

According to classical macroeconomic theory,changes in the money supply affect

Correct Answer
verified

An economic contraction caused by a shift in aggregate demand remedies itself over time as the expected price level

Correct Answer
verified

The long-run aggregate supply curve shifts right if

Correct Answer
verified

Exam 34: Aggregate Demand and Aggregate Supply

The aggregate-demand curve

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When taxes increase,consumption

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Suppose the economy is in long-run equilibrium.If there is a sharp decline in the stock market combined with a significant increase in immigration of skilled workers,then in the short run,

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Figure 34-1 -Refer to Figure 34-1.An increase in the money supply would move the economy from C to

Correct AnswerverifiedShow Answer

Other things the same,as the price level falls,the exchange rate rises.A rise in the exchange rate leads to a decrease in net exports.

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According to classical macroeconomic theory,changes in the money supply affect

Correct AnswerverifiedShow Answer

An economic contraction caused by a shift in aggregate demand remedies itself over time as the expected price level

Correct AnswerverifiedShow Answer

The long-run aggregate supply curve shifts right if

Correct AnswerverifiedShow Answer

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Correct Answer
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Correct Answer
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