Exam 5: Introduction to Macroeconomics

Keynes believed that the best method for ending the Great Depression was to reduce government spending and raise taxes,thereby reducing the federal budget deficit.

Which of the following best describes the Keynesian approach to economic policy?

The ultimate objective of macroeconomics is to

The largest and most complex economy in world history is

Capital is a stock variable.

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 fall,what will the new equilibrium be?

To control inflation,President Nixon

In terms of the aggregate demand and supply framework,the Great Depression can be viewed in terms of a

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 the price level in Europe falls,what will the new equilibrium be?

In the history of the U.S.economy,which economic era saw both high unemployment and high inflation at the same time?

Which of the following is a stock variable?

An increase in the price level will cause

Exhibit 5-1 -In Exhibit 5-1 in period 2,which of the following would cause the aggregate supply curve to shift from AS to AS'.

According to Keynes,in order to get the economy out of a recession,the government should

Which of the following best describes a stock (rather than a flow)?

Given the aggregate demand curve,an increase in aggregate supply would raise real GDP and reduce the price level.

Keynes was in favor of a federal budget __________ to cure __________.

Which of the following is a stock variable?

Which of the following statements about leading economic indicators is true?

Which of the following is not a flow variable?