Exam 12: Aggregate Demand and Aggregate Supply

Which combination of factors would most likely increase aggregate demand?

Which would most likely increase aggregate supply?

The short-run aggregate supply curve shows the:

When the economy is experiencing demand-pull inflation, its real GDP tends to be rising.

The long-run aggregate supply curve is:

An increase in personal income tax rates will cause a(n):

Suppose that an economy produces 2400 units of output, employing the 60 units of input, and the price of the input is $30 per unit. Refer to the information above. If productivity increased such that 3000 units are now produced with the quantity of inputs still equal to 60, then per-unit production costs would:

The aggregate demand curve or schedule shows the relationship between the total demand for output and the:

An increase in expected future income will:

Cost-push inflation is characterized by a(n):

If the dollar appreciates in value relative to foreign currencies:

The foreign purchases, interest rate, and real-balances effects explain why the:

The labels for the axes of the aggregate demand graph should be:

A fall in the prices of inputs will shift the aggregate:

Refer to the graph above. Which of the following factors will shift AD₁ to AD₂?

If the national incomes of our trading partners increase, then our:

Refer to the figure above. A shift from AD₁ shifts to AD₂ would be consistent with what economic event in U.S. history?

A decrease in government spending will cause a(n):

Refer to the graph above. The equilibrium for this economy is:

An increase in the price level reduces the real value of financial assets with fixed money values and, as a result, the holders of these assets decrease their spending.