Question 1

If the inflation rate decreases,

Accepted Answer

A)  the equilibrium deficit-to-GDP ratio will decrease. 
B)  the equilibrium debt-to-GDP ratio will decrease. 
C)  the equilibrium deficit-to-GDP ratio will increase. 
D)  the equilibrium debt-to-GDP ratio will increase. 
A)  the equilibrium deficit-to-GDP ratio will decrease. 
B)  the equilibrium debt-to-GDP ratio will decrease. 
C)  the equilibrium deficit-to-GDP ratio will increase. 
D)  the equilibrium debt-to-GDP ratio will increase.

Question 2

The almost doubling of the debt-to-GDP ration during the Reagan presidency was due in part to each of the following except

Accepted Answer

A)  higher spending on defense and other programs. 
B)  substantially higher spending on social welfare programs that primarily benefit low-income persons. 
C)  substantial tax cuts. 
D)  the productivity slowdown. 
A)  higher spending on defense and other programs. 
B)  substantially higher spending on social welfare programs that primarily benefit low-income persons. 
C)  substantial tax cuts. 
D)  the productivity slowdown.

Question 3

The lower the debt-to-GDP ratio,

Accepted Answer

A)  the less risky an investment do financiers judge the debt of the country and the less willing they will be to buy and hold that debt. 
B)  the more risky an investment do financiers judge the debt of the country and the less willing they will be to buy and hold that debt. 
C)  the less risky an investment do financiers judge the debt of the country and the more willing they will be to buy and hold that debt. 
D)  the more risky an investment do financiers judge the debt of the country and the more willing they will be to buy and hold that debt. 
A)  the less risky an investment do financiers judge the debt of the country and the less willing they will be to buy and hold that debt. 
B)  the more risky an investment do financiers judge the debt of the country and the less willing they will be to buy and hold that debt. 
C)  the less risky an investment do financiers judge the debt of the country and the more willing they will be to buy and hold that debt. 
D)  the more risky an investment do financiers judge the debt of the country and the more willing they will be to buy and hold that debt.

Question 4

The higher the debt-to-GDP ratio,

Accepted Answer

A)  the more likely is the government to resort to inflation as a means to reduce the real burden of the debt. 
B)  the less likely is the government to resort to inflation as a means to reduce the real burden of the debt. 
C)  the more likely is the government to resort to inflation as a means to increase the real burden of the debt. 
D)  the less likely is the government to resort to inflation as a means to increase the real burden of the debt. 
A)  the more likely is the government to resort to inflation as a means to reduce the real burden of the debt. 
B)  the less likely is the government to resort to inflation as a means to reduce the real burden of the debt. 
C)  the more likely is the government to resort to inflation as a means to increase the real burden of the debt. 
D)  the less likely is the government to resort to inflation as a means to increase the real burden of the debt.

Question 5

A change in government tax policy that increases government tax collections

Accepted Answer

A)  shifts the LM curve to the right and may change its slope. 
B)  shifts the IS curve to the right and may change its slope. 
C)  shifts the LM curve to the left and may change its slope. 
D)  shifts the IS curve to the left and may change its slope. 
A)  shifts the LM curve to the right and may change its slope. 
B)  shifts the IS curve to the right and may change its slope. 
C)  shifts the LM curve to the left and may change its slope. 
D)  shifts the IS curve to the left and may change its slope.

If the inflation rate decreases,

The almost doubling of the debt-to-GDP ration during the Reagan presidency was due in part to each of the following except

The lower the debt-to-GDP ratio,

The higher the debt-to-GDP ratio,

A change in government tax policy that increases government tax collections

Introduction to Macroeconomics

Measuring the Macroeconomy

Thinking Like an Economist

The Theory of Economic Growth

The Reality of Economic Growth: History and Prospect

Building Blocks of the Flexible-Price Model

Equilibrium in the Flexible-Price M Odel

Money, Prices, and Inflation

The Sticky-Price Income-Expenditure Framework: Consumption and the Multiplier

Investment, Net Exports, and Interest Rates: The Is Curve

The Money Market and the LM Curve

The Phillips Curve, Expectations, and Monetary Policy

Stabilization Policy

International Economic Policy

Changes in the Macroeconomy and Changes in Macroeconomic Policy

The Future of Macroeconomics

Epilogue

Filters

Exam 14: Budget Balance, National Debt, and Investment

If the inflation rate decreases,

The almost doubling of the debt-to-GDP ration during the Reagan presidency was due in part to each of the following except

The lower the debt-to-GDP ratio,

The higher the debt-to-GDP ratio,

A change in government tax policy that increases government tax collections

Introduction to Macroeconomics

Measuring the Macroeconomy

Thinking Like an Economist

The Theory of Economic Growth

The Reality of Economic Growth: History and Prospect

Building Blocks of the Flexible-Price Model

Equilibrium in the Flexible-Price M Odel

Money, Prices, and Inflation

The Sticky-Price Income-Expenditure Framework: Consumption and the Multiplier

Investment, Net Exports, and Interest Rates: The Is Curve

The Money Market and the LM Curve

The Phillips Curve, Expectations, and Monetary Policy

Stabilization Policy

International Economic Policy

Changes in the Macroeconomy and Changes in Macroeconomic Policy

The Future of Macroeconomics

Epilogue

Filters