Question 1

Which of the following lists includes only changes that shift aggregate demand to the right?

Accepted Answer

A)  repeal of an investment tax credit, an increase in the money supply 
B)  repeal of an investment tax credit, a decrease in the money supply 
C)  passing of an investment tax credit, an increase in the money supply 
D)  passing of an investment tax credit, a decrease in the money supply 
A)  repeal of an investment tax credit, an increase in the money supply 
B)  repeal of an investment tax credit, a decrease in the money supply 
C)  passing of an investment tax credit, an increase in the money supply 
D)  passing of an investment tax credit, a decrease in the money supply

Question 2

Which of the following is not a determinant of the long-run level of real GDP?

Accepted Answer

A)  the price level. 
B)  the amount of capital used by firms. 
C)  available stock of human capital. 
D)  available technology 
A)  the price level. 
B)  the amount of capital used by firms. 
C)  available stock of human capital. 
D)  available technology

Question 3

Other things the same, if the price level is lower than expected, then some firms believe that the relative price of what they produce has

Accepted Answer

A)  decreased, so they increase production. 
B)  decreased, so they decrease production. 
C)  increased, so they increase production. 
D)  increased, so they decrease production. 
A)  decreased, so they increase production. 
B)  decreased, so they decrease production. 
C)  increased, so they increase production. 
D)  increased, so they decrease production.

Question 4

Other things the same, when the price level rises, interest rates

Accepted Answer

A)  rise, which means consumers will want to spend more on homebuilding. 
B)  rise, which means consumers will want to spend less on homebuilding. 
C)  fall, which means consumers will want to spend more on homebuilding. 
D)  fall, which means consumers will want to spend less on homebuilding. 
A)  rise, which means consumers will want to spend more on homebuilding. 
B)  rise, which means consumers will want to spend less on homebuilding. 
C)  fall, which means consumers will want to spend more on homebuilding. 
D)  fall, which means consumers will want to spend less on homebuilding.

Question 5

Other things the same, as the price level falls, which of the following increases?

Accepted Answer

A)  lending and investment spending 
B)  lending, but not investment spending 
C)  investment spending, but not lending 
D)  neither investment spending nor lending 
A)  lending and investment spending 
B)  lending, but not investment spending 
C)  investment spending, but not lending 
D)  neither investment spending nor lending

Question 6

The variables on the vertical and horizontal axes of the aggregate demand and supply graph are

Accepted Answer

A)  the price level and real output. 
B)  real output and employment. 
C)  employment and the inflation rate. 
D)  the value of money and the price level. 
A)  the price level and real output. 
B)  real output and employment. 
C)  employment and the inflation rate. 
D)  the value of money and the price level.

Question 7

Other things the same, the aggregate quantity of goods demanded in the U.S. increases if

Accepted Answer

A)  real wealth rises. 
B)  the interest rate rises. 
C)  the dollar appreciates. 
D)  All of the above are correct. 
A)  real wealth rises. 
B)  the interest rate rises. 
C)  the dollar appreciates. 
D)  All of the above are correct.

Question 8

The saying "Money is a veil." means that

Accepted Answer

A)  while nominal variables are the first thing we may observe about an economy, what's important are the real variables and the forces that determine them. 
B)  money is the principal medium of exchange in most economies. 
C)  the primary determinant of short-run economic fluctuations is not real variables, but rather changes in the money supply. 
D)  in the long run money is of no importance to the determination of either real or nominal variables. 
A)  while nominal variables are the first thing we may observe about an economy, what's important are the real variables and the forces that determine them. 
B)  money is the principal medium of exchange in most economies. 
C)  the primary determinant of short-run economic fluctuations is not real variables, but rather changes in the money supply. 
D)  in the long run money is of no importance to the determination of either real or nominal variables.

Question 9

The aggregate-demand curve

Accepted Answer

A)  has a slope that is explained in the same way as the slope of the demand curve for a particular product. 
B)  is vertical in the long run. 
C)  shows an inverse relation between the price level and the quantity of all goods and services demanded. 
D)  All of the above are correct. 
A)  has a slope that is explained in the same way as the slope of the demand curve for a particular product. 
B)  is vertical in the long run. 
C)  shows an inverse relation between the price level and the quantity of all goods and services demanded. 
D)  All of the above are correct.

Question 10

When the price level falls, people want to

Accepted Answer

A)  hold more money and the quantity of aggregate goods and services demanded increases. 
B)  hold more money and the quantity of aggregate goods and services demanded decreases. 
C)  hold less money and the quantity of aggregate goods and services demanded increases. 
D)  hold less money and the quantity of aggregate goods and services demanded decreases. 
A)  hold more money and the quantity of aggregate goods and services demanded increases. 
B)  hold more money and the quantity of aggregate goods and services demanded decreases. 
C)  hold less money and the quantity of aggregate goods and services demanded increases. 
D)  hold less money and the quantity of aggregate goods and services demanded decreases.

Question 11

Figure 33-13.  
Refer to Figure 33-13. Identify the price and output levels consistent with long-run equilibrium.

Accepted Answer

The answer of Figure 33-13.  
Refer to Figure 33-13....

Question 12

Most economists believe that classical theory describes the world

Accepted Answer

A)  in the short run. 
B)  in the long run. 
C)  in both the short run and the long run. 
D)  in neither the short run nor the long run. 
A)  in the short run. 
B)  in the long run. 
C)  in both the short run and the long run. 
D)  in neither the short run nor the long run.

Question 13

If the price level falls, the real value of a dollar

Accepted Answer

A)  rises, so people will want to buy more. This response helps explain the slope of the aggregate demand curve. 
B)  rises, so people will want to buy more. This response shifts aggregate demand to the right. 
C)  falls, so people will want to buy less. This response helps explain the slope of the aggregate demand curve. 
D)  falls, so people will want to buy less. This response shifts aggregate demand to the left. 
A)  rises, so people will want to buy more. This response helps explain the slope of the aggregate demand curve. 
B)  rises, so people will want to buy more. This response shifts aggregate demand to the right. 
C)  falls, so people will want to buy less. This response helps explain the slope of the aggregate demand curve. 
D)  falls, so people will want to buy less. This response shifts aggregate demand to the left.

Question 14

Other things the same, as the price level rises, the real value of a dollar

Accepted Answer

A)  rises, and interest rates rise. 
B)  rises, and interest rates fall. 
C)  falls, and interest rates rise. 
D)  falls, and interest rates fall. 
A)  rises, and interest rates rise. 
B)  rises, and interest rates fall. 
C)  falls, and interest rates rise. 
D)  falls, and interest rates fall.

Question 15

Which of the following both shift aggregate demand left?

Accepted Answer

A)  a decrease in taxes and at a given price level consumers feel more wealthy 
B)  a decrease in taxes and at a given price level consumers feel less wealthy 
C)  an increase in taxes and at a given price level consumers feel more wealthy 
D)  an increase in taxes and at a given price level consumers feel less wealthy 
A)  a decrease in taxes and at a given price level consumers feel more wealthy 
B)  a decrease in taxes and at a given price level consumers feel less wealthy 
C)  an increase in taxes and at a given price level consumers feel more wealthy 
D)  an increase in taxes and at a given price level consumers feel less wealthy

Question 16

Which of the following is most commonly used to monitor short-run changes in economic activity?

Accepted Answer

A)  the inflation rate. 
B)  real GDP. 
C)  interest rates. 
D)  value of the U.S. dollar in the foreign exchange market. 
A)  the inflation rate. 
B)  real GDP. 
C)  interest rates. 
D)  value of the U.S. dollar in the foreign exchange market.

Question 17

Real and nominal variables are highly intertwined, and changes in the money supply change real GDP. Most economists would agree that this statement accurately describes

Accepted Answer

A)  both the short run and the long run. 
B)  the short run, but not the long run. 
C)  the long run, but not the short run. 
D)  neither the long run nor the short run. 
A)  both the short run and the long run. 
B)  the short run, but not the long run. 
C)  the long run, but not the short run. 
D)  neither the long run nor the short run.

Question 18

Which of the following alone can explain the change in the price level and output during World War II?

Accepted Answer

A)  aggregate demand shifted right 
B)  aggregate demand shifted left 
C)  aggregate supply shifted right 
D)  aggregate supply shifted left 
A)  aggregate demand shifted right 
B)  aggregate demand shifted left 
C)  aggregate supply shifted right 
D)  aggregate supply shifted left

Question 19

Suppose a stock market crash makes people feel poorer. This decrease in wealth would induce people to

Accepted Answer

A)  decrease consumption, which shifts aggregate supply left. 
B)  decrease consumption, which shifts aggregate demand left. 
C)  increase consumption, which shifts aggregate supply right. 
D)  increase consumption, which shifts aggregate demand right. 
A)  decrease consumption, which shifts aggregate supply left. 
B)  decrease consumption, which shifts aggregate demand left. 
C)  increase consumption, which shifts aggregate supply right. 
D)  increase consumption, which shifts aggregate demand right.

Question 20

Other things the same, which of the following is correct?

Accepted Answer

A)  A decrease in the price level causes the dollar to appreciate. Aggregate demand shifts right. 
B)  A decrease in the price level causes the dollar to depreciate. Aggregate demand shifts right. 
C)  If speculators lose confidence in the American economy, the dollar appreciates. Aggregate demand shifts right. 
D)  If speculators lose confidence in the American economy, the dollar depreciates. Aggregate demand shifts right. 
A)  A decrease in the price level causes the dollar to appreciate. Aggregate demand shifts right. 
B)  A decrease in the price level causes the dollar to depreciate. Aggregate demand shifts right. 
C)  If speculators lose confidence in the American economy, the dollar appreciates. Aggregate demand shifts right. 
D)  If speculators lose confidence in the American economy, the dollar depreciates. Aggregate demand shifts right.

Which of the following lists includes only changes that shift aggregate demand to the right?

Which of the following is not a determinant of the long-run level of real GDP?

Other things the same, if the price level is lower than expected, then some firms believe that the relative price of what they produce has

Other things the same, when the price level rises, interest rates

Other things the same, as the price level falls, which of the following increases?

The variables on the vertical and horizontal axes of the aggregate demand and supply graph are

Other things the same, the aggregate quantity of goods demanded in the U.S. increases if

The saying "Money is a veil." means that

The aggregate-demand curve

When the price level falls, people want to

Figure 33-13. Refer to Figure 33-13. Identify the price and output levels consistent with long-run equilibrium.

Most economists believe that classical theory describes the world

If the price level falls, the real value of a dollar

Other things the same, as the price level rises, the real value of a dollar

Which of the following both shift aggregate demand left?

Which of the following is most commonly used to monitor short-run changes in economic activity?

Real and nominal variables are highly intertwined, and changes in the money supply change real GDP. Most economists would agree that this statement accurately describes

Which of the following alone can explain the change in the price level and output during World War II?

Suppose a stock market crash makes people feel poorer. This decrease in wealth would induce people to

Other things the same, which of the following is correct?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 15: Aggregate Demand and Aggregate Supply

Which of the following lists includes only changes that shift aggregate demand to the right?

Which of the following is not a determinant of the long-run level of real GDP?

Other things the same, if the price level is lower than expected, then some firms believe that the relative price of what they produce has

Other things the same, when the price level rises, interest rates

Other things the same, as the price level falls, which of the following increases?

The variables on the vertical and horizontal axes of the aggregate demand and supply graph are

Other things the same, the aggregate quantity of goods demanded in the U.S. increases if

The saying "Money is a veil." means that

The aggregate-demand curve

When the price level falls, people want to

Figure 33-13. Refer to Figure 33-13. Identify the price and output levels consistent with long-run equilibrium.

Most economists believe that classical theory describes the world

If the price level falls, the real value of a dollar

Other things the same, as the price level rises, the real value of a dollar

Which of the following both shift aggregate demand left?

Which of the following is most commonly used to monitor short-run changes in economic activity?

Real and nominal variables are highly intertwined, and changes in the money supply change real GDP. Most economists would agree that this statement accurately describes

Which of the following alone can explain the change in the price level and output during World War II?

Suppose a stock market crash makes people feel poorer. This decrease in wealth would induce people to

Other things the same, which of the following is correct?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters