Exam 5: Introduction to Macroeconomics

Exhibit 5-3 -In Exhibit 5-3 AD₁ and AS₁ represent the initial aggregate demand and aggregate supply.The initial equilibrium is at point A.Suppose that global oil prices rise,what will the new equilibrium be?

Between 1947 and 1998,total U.S.employment

If business leaders become pessimistic about future sales and profits,they will __________ spending on plant and equipment,which __________ employment and income and,therefore,their expectations are __________.

Given an aggregate supply curve that slopes upward,an increase in aggregate demand would decrease real GDP.

Which of the following was a central argument of Keynes's General Theory?

On an aggregate demand and aggregate supply graph,the Great Depression can be pictured as

Which of the following events did not occur in the 1970s?

The aggregate supply curve indicates

Stagflation is best described as

The Reagan administration's policies were aimed at managing aggregate demand.

According to Keynes,the policy of incurring budget deficits will cause the equilibrium price level to __________ and equilibrium output to __________.

If all firms expect greater demand for their products or services,they will hire __________ resources (e.g.,labor and capital)and the economy will experience __________.

In the United States before 1970,

All of the following would be considered supply-side approaches to increasing growth except one.Which is the exception?

As the price level rises,individuals feel richer.Therefore,they will spend more.

Exhibit 5-2 -Refer to Exhibit 5-2.Which line or point represents real GDP?

Gross Domestic Product measures the value of all final goods and services produced within a nation's borders.

The distinction between recessions and depressions is that recessions are

A recession is a period during which

Certain economic activities signal forthcoming changes in the economy.These are known as the