Macro Economics Chapter 10 Quiz Flashcards
The aggregate demand curve: A: shows the level of real GDP purchased in the economy at different possible price levels during a period of time.B: Shows the level of real GDP produced in the economy at different possible price levels during a period of time.C: shifts to the left whenever there is an increase in aggregate expenditures. D: slopes upward.
A
When price level in the United States rises, A: there is a increased demand for borrowed money.B: producers’ demand for new machinery increases, contributing to an increase in aggregate demand.C: Americans tend to buy more foreign goods and services. D: the French, Canadians, and Japanese would find our exports more attractive.E: to replenish the value of your real wealth, you would save less and consume more.
C
When the price level falls, the total quantities of goods and services demanded: A: decreases.B: stays the same. C: increases. D: increases and then decreases. E: decreases and then increases.
C
The real balances effect occurs because a higher price level will reduce the real value of people’s: A: financial assets. B: wages. C: unpaid debt. D: physical investments.
A
Which of the following would shift the aggregate demand curve to the left? A: An increase in exports. B: An increase in investment. C: An increase in government spending. D: A decrease in government spending.
D
If every household in the United States won a lottery which gave it an extra $50,000 to spend, the: A: aggregate supply curve would shift to the right. B: aggregate supply curve would shift to the left. C: general price level would rise causing a movement up the aggregate demand curve. D: aggregate demand curve would shift to the left. E: aggregate demand curve would shift to the right.
E
Gradual adjustment of prices and wages to an increase in the aggregate demand curve implies that the aggregate supply curve is: A: horizontal. B: Vertical. C: upward sloping but not vertical. D: downward sloping.
C
In the upward-sloping segment of the aggregate supply curve, A: increases in output are linked to decreases in the price level.B: increasing prices drag down resource costs. C: producers can hire more workers without having to raise the wage rate. D: the economy can increase aggregate supply without prices going up. E: firms are willing to pay higher wages to get more labor.
E
At low levels of employment, the Keynesian aggregate supply curve: A: tilts downward to the right. B: tilts upward to the right. C: is vertical. D: shows a constant price level. E: shows a rising price level.
D
