Exam 25: Aggregate Demand and the Powerful Consumer

The difference between Gross National Product and Net National Product is the

Which of the following is not part of the investment component of GDP?

Melissa purchases shares in a government bond mutual fund.Is this included in the aggregate demand component "Investment"?

If the MPC is .80, then a change in disposable income of $60 billion will lead to an initial change in consumption of

Disposable income is obtained by

Based on the relative size of factor payments, the most important resource in the U.S.economy is

Which of the following would be added to U.S.national income?

National income and domestic product must be equal.

Government purchases are included in national product.

Consumer spending represents about what fraction of total spending in the economy?

U.S.imports rise when income in the United States increases.

Which factors will cause the consumption function to shift? Which factors do not cause the function to shift?

Which of the following would be counted as investment in the national income accounts?

Governments can affect the level of aggregate demand in a direct way by changing

After years of hard work in the field of macroeconomics, you win the Nobel Prize in economics (currently about $1.5 million).What is the most likely effect of this prize on your consumption function?

The Marginal Propensity to Consume (MPC) is defined as the change in

If you produce a graph with consumption spending on the vertical axis and disposable income on the horizontal axis, the relation between consumption and income will

Define the following terms and explain their importance in the study of macroeconomics: a.consumer expenditures b.investment spending c.national income d.transfer payments

Adding depreciation to net national product yields

If personal taxes are increased by $10 billion, we can expect that consumers will reduce