macroeconomics quiz -When the real GDP increases, disposable income
|
Question 1 of 40 |
2.5 Points |
When the real GDP increases, disposable income and consumption expenditure __________.
|
A. do not change |
|
|
B. become inverted |
|
|
C. decrease |
|
|
D. increase |
|
Question 2 of 40 |
2.5 Points |
A rise in the price level __________ the buying power of money.
|
A. does not affect |
|
|
B. increases |
|
|
C. decreases |
|
|
D. inverts |
|
Question 3 of 40 |
2.5 Points |
How does an increase in potential GDP affect aggregate supply?
|
A. It decreases aggregate supply. |
|
|
B. It increases aggregate supply. |
|
|
C. It barely has any effect. |
|
|
D. Since it applies to an “imaginary” market, it does not affect aggregate supply. |
|
Question 4 of 40 |
2.5 Points |
__________ occurs when aggregate planned expenditure equals real GDP.
|
A. Price-fixing |
|
|
B. Stable economic leveling |
|
|
C. Unplanned inventory change |
|
|
D. Equilibrium expenditure |
|
Question 5 of 40 |
2.5 Points |
Aggregate __________ is the sum of planned consumption expenditure, investment, government expenditure on goods and services, and exports minus imports.
|
A. planned expenditure |
|
|
B. supply |
|
|
C. demand |
|
|
D. expenditure schedule |
|
Question 6 of 40 |
2.5 Points |
When governments change taxes, their transfer payments, and expenditure on goods and service, they influence aggregate demand through __________.
|
A. the world economy |
|
|
B. consumer expectations |
|
|
C. monetary policy |
|
|
D. fiscal policy |
|
Question 7 of 40 |
2.5 Points |
If the price level from the GDP price index falls, what happens to the quantity of real GDP supplied?
|
A. it remains constant |
|
|
B. it increases |
|
|
C. it decreases |
|
|
D. it barely changes |
|
Question 8 of 40 |
2.5 Points |
Which of the following would cause an increase in aggregate demand in the short run?
|
A. an increase in the supply of money |
|
|
B. a decrease in the price level |
|
|
C. an increase in taxes |
|
|
D. a crop failure |
|
Question 9 of 40 |
2.5 Points |
What is the total amount of final goods and service produced in a country that people, businesses, governments, and foreigners plan to buy?
|
A. the supply-demand model |
|
|
B. the quantity of real GDP supplied |
|
|
C. the quantity of potential GDP |
|
|
D. the quantity of real GDP demanded |
|
Question 10 of 40 |
2.5 Points |
The __________ is the amount by which a change in autonomous expenditures is multiplied in order to determine the change in equilibrium expenditure that it generates.
|
A. marginal tax rate |
|
|
B. marginal multiplier |
|
|
C. expenditure reducer |
|
|
D. expenditure multiplier |
|
Question 11 of 40 |
2.5 Points |
The change in equilibrium expenditure also equals the change in __________.
|
A. the potential GDP |
|
|
B. the real GDP |
|
|
C. income taxes |
|
|
D. interest rates |
|
Question 12 of 40 |
2.5 Points |
Which of the following does NOT decrease aggregate demand in the United States?
|
A. a decrease in the price of oil |
|
|
B. a decrease in GDP in Germany |
|
|
C. a decrease in government spending |
|
|
D. a decrease in the supply of money |
|
Question 13 of 40 |
2.5 Points |
The __________ curve summarizes the relationship between aggregate planned expenditure and the real GDP.
|
A. AES |
|
|
B. AE |
|
|
C. AD |
|
|
D. APE |
|
Question 14 of 40 |
2.5 Points |
Why does the quantity of real GDP supplied change when the price level changes?
|
A. movement along the AS curve brings a change in the price of resources |
|
|
B. movement along the AS curve brings a change in the potential GDP |
|
|
C. movement along the AS curve brings a change in the GDP price index |
|
|
D. movement along the AS curve brings a change in the real wage rate |
|
Question 15 of 40 |
2.5 Points |
To determine the equilibrium price level and equilibrium level of real GDP, the aggregate demand and aggregate supply must __________.
|
A. be considered separately |
|
|
B. intersect |
|
|
C. be disregarded |
|
|
D. be considered as a multiplier |
|
Question 16 of 40 |
2.5 Points |
When the real wage rate changes, firms change the __________ and the level of production.
|
A. wage rate of employees |
|
|
B. quality of goods or services produced |
|
|
C. quantity of labor employed |
|
|
D. production plans |
|
Question 17 of 40 |
2.5 Points |
All other things remaining the same, the lower the price level, the __________ the quantity of real GDP demanded.
|
A. smaller |
|
|
B. greater |
|
|
C. more constant |
|
|
D. less constant |
|
Question 18 of 40 |
2.5 Points |
Expenditures such as investment, government expenditure on goods and services, and exports __________ on real GDP.
|
A. do not depend |
|
|
B. depend greatly |
|
|
C. remain constant based |
|
|
D. vary in their individual dependence |
|
Question 19 of 40 |
2.5 Points |
What are the two main influences that the world economy has on aggregate demand?
|
A. foreign exchange rate and foreign income |
|
|
B. foreign investments and foreign profit |
|
|
C. revenues from overseas and foreign exchange rate |
|
|
D. foreign expenditures and international trade |
|
Question 20 of 40 |
2.5 Points |
What is the total amount of final goods and service that firms in a country plan to produce, depending on the labor, capital, technology, natural resources, and entrepreneurial talent in the market?
|
A. the supply-demand model |
|
|
B. the quantity of real gross domestic product (GDP. supplied |
|
|
C. the quantity of potential GDP |
|
|
D. the quantity of real GDP demanded |
|
Question 21 of 40 |
2.5 Points |
Suppose GDP __________ the level of potential output. We would expect to see __________ unemployment, rising wages, and rising prices.
|
A. exceeds; high |
|
|
B. exceeds; low |
|
|
C. is below; high |
|
|
D. is below; low |
|
Question 22 of 40 |
2.5 Points |
What is the difference between how GDP is determined in the short run and how it is determined in the long run?
|
A. In the short run, GDP is determined by current demand for goods and services in the economy. In the long run, GDP is determined by supply of labor, the stock of capital and technological progress. |
|
|
B. In the short run, GDP is determined by future demand for goods and services in the economy. In the long run, GDP is determined by supply of labor, the stock of capital and technological progress. |
|
|
C. In the long run, GDP is determined by current demand for goods and services in the economy. In the short run, GDP is determined by supply of labor, the stock of capital and technological progress. |
|
|
D. In the long run, GDP is determined by future demand for goods and services in the economy. In the short run, GDP is determined by supply of labor, the stock of capital and technological progress. |
|
Question 23 of 40 |
2.5 Points |
If the natural unemployment rate increases, the short-term Phillips curve __________ and the long-run Phillips curve __________.
|
A. shifts rightward; shifts rightward |
|
|
B. shifts leftward; shifts leftward |
|
|
C. shifts rightward; remains the same |
|
|
D. shifts leftward; remains the same |
|
Question 24 of 40 |
2.5 Points |
How does change in the expected inflation rate affect the short-run tradeoff between inflation and unemployment?
|
A. Immediately, because the money wage rate is sensitive to change in the expected inflation rate. |
|
|
B. Immediately, because unemployment and job production respond quickly to change in the expected inflation rate. |
|
|
C. Gradually, because the money wage rate responds only gradually to change in the expected inflation rate. |
|
|
D. Gradually, because the natural unemployment rate rarely changes. |
|
Question 25 of 40 |
2.5 Points |
The __________ shows the relationship between inflation and unemployment when the economy is at full employment.
|
A. AS curve |
|
|
B. short-run Phillips curve |
|
|
C. long-run Phillips curve |
|
|
D. AE curve |
|
Question 26 of 40 |
2.5 Points |
The __________ is a curve that shows the relationship between the inflation rate and the unemployment rate when the natural unemployment rate and the expected inflation rate remain constant.
|
A. aggregate demand (AD. curve |
|
|
B. short-run Phillips curve |
|
|
C. long-run Phillips curve |
|
|
D. aggregate expenditure (AE. curve |
|
Question 27 of 40 |
2.5 Points |
What policy action by the Fed describes an unexpected rise in interest rates and deceleration in money growth in order to slow inflation at the cost of recession?
|
A. rational reduction |
|
|
B. surprise inflation reduction |
|
|
C. credible announced inflation reduction |
|
|
D. statistical model of reduction |
|
Question 28 of 40 |
2.5 Points |
What is the forecast for inflation that results from the analysis of all the relevant data and economic science?
|
A. rational expectation |
|
|
B. surprise inflation expectation |
|
|
C. credible announced inflation expectation |
|
|
D. statistical model of expectation |
|
Question 29 of 40 |
2.5 Points |
The __________ is the percentage change in the price level.
|
A. Phillips curve |
|
|
B. consumer price index |
|
|
C. unemployment rate |
|
|
D. inflation rate |
|
Question 30 of 40 |
2.5 Points |
The short-run Phillips curve is another way at looking at the __________.
|
A. equilibrium expenditure |
|
|
B. AD curve |
|
|
C. aggregate supply (AS. curve |
|
|
D. potential GDP |
|
Question 31 of 40 |
2.5 Points |
A necessary condition for the classical model to work is that __________.
|
A. wages and prices are fully flexible |
|
|
B. prices, but not wages, are fully flexible |
|
|
C. wages and prices are not fully flexible |
|
|
D. wages, but not prices, are fully flexible |
|
Question 32 of 40 |
2.5 Points |
Suppose that the unemployment rate is __________ the natural rate. We would expect prices to fall, money demand to fall, interest rates to fall, and total demand to __________.
|
A. above; rise |
|
|
B. above; fall |
|
|
C. below; rise |
|
|
D. below; fall |
|
Question 33 of 40 |
2.5 Points |
Since the long-run Phillips curve is vertical at the natural unemployment rate, what type of trade-off is there between employment and inflation?
|
A. There is no trade-off between employment and inflation. |
|
|
B. There is a constant trade-off between employment and inflation. |
|
|
C. There is a linear trade-off between employment and inflation. |
|
|
D. Employment and inflation are indirectly proportional (the one goes up, the other goes down.. |
|
Question 34 of 40 |
2.5 Points |
What is the name for the inflation rate that people forecast and use to set the money wage rate and other money prices?
|
A. the equilibrium inflation rate |
|
|
B. the fixed-money inflation rate |
|
|
C. the potential inflation rate |
|
|
D. the expected inflation rate |
|
Question 35 of 40 |
2.5 Points |
Keynes expressed doubts that that the economy would __________.
|
A. ever return to full-employment |
|
|
B. ever move away from full-employment |
|
|
C. recover from a major recession without active policy |
|
|
D. recover from the effects of higher prices |
|
Question 36 of 40 |
2.5 Points |
A decrease in aggregate demand that brings a movement down along the aggregate supply curve lowers the price level and __________ real GDP.
|
A. does not affect |
|
|
B. decreases |
|
|
C. increases |
|
|
D. varies with |
|
Question 37 of 40 |
2.5 Points |
To lower the expected inflation rate, the Fed must take actions that will __________ the actual inflation rate.
|
A. decelerate |
|
|
B. accelerate |
|
|
C. increase |
|
|
D. decrease |
|
Question 38 of 40 |
2.5 Points |
The Federal Reserve can use monetary policy to __________.
|
A. change output in the long run, but not the short run |
|
|
B. change output in the short run, but not the long run |
|
|
C. change output in both the short run and the long run |
|
|
D. Monetary policy has no effect on output |
|
Question 39 of 40 |
2.5 Points |
In the long run, a decrease in the money supply __________.
|
A. has no effect on real interest rates, investment, or output |
|
|
B. increases real interest rates, decreases investment, and decreases output |
|
|
C. increases real interest rates, increases investment, and decreases output |
|
|
D. decreases real interest rates, decreases investment, and decreases output |
|
Question 40 of 40 |
2.5 Points |
Say’s law from a classical economic perspective __________.
|
A. states that supply creates its own demand |
|
|
B. explains the classical idea that the value of GDP will equal the demand for goods and services |
|
|
C. supports economists belief that neither surplus nor shortage would ever exist when production and demand are equal for goods and services |
|
|
D. all of the above |
-
Rating:
/5
Solution: macroeconomics quiz -When the real GDP increases, disposable income