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Quiz

Macro Exam 2 practice

Isaiah Andrade 20 perguntas

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Perguntas do quiz (20)

  1. 1Which of the following is NOT an element of the basis for the analysis of Aggregate Expenditures (AE) and Aggregate Demand (AD)?
    1. AAE = Consumption + Investment + Government Purchases + Net Exports
    2. BAE = Real GDP
    3. CFirms invest based on expected rate of return and we assume their expectations are met
    4. DAs incomes increase consumption will increase
    5. EHigh prices, all else being equal, lead to lower consumption
  2. 2In performing the analysis in Chapter 9we, at times, apply a number of assumptions. Which of the following assumptions is realistic
    1. AAs income increases Investment does not change
    2. BAs income increases Government Purchases does not change
    3. CAs income increases Net Exports does not change
    4. DIn the short run, firms will not immediately increase production if they are selling more product than they are currently producing based on expectations
    5. EIn the long run, as production, incomes, and spending increase, the price level does not change
  3. 3If Planned Aggregate Expenditures fall short of Real GDP (the level of output), what would be the initial reaction in the long run?
    1. Ainventories will increase
    2. Binventories will decrease
    3. Cproduction will increase
    4. Dproduction will decrease
    5. Enothing - there is no reason to believe there will be any reaction
  4. 4What does the concept of a multiplier effect tell us?
    1. Athe price level will increase be some multiple of an increase in aggregate expenditures
    2. BAggregate expenditures will grow by some multiple of an increase in imports
    3. CReal GDP will grow by some multiple of an increase in Aggregate Expenditures
    4. DReal GDP will grow by some multiple of an increase in Aggregate Demand
    5. EAggregate Demand is downward sloping
  5. 5Which of the following considerations would NOT call into question the validity or accuracy of the simple spending multiplier
    1. Aas disposable income increase saving tends to increase
    2. Bas disposable income increase imports tend to increase
    3. Cas aggregate income increases taxes tend to increase
    4. Das incomes and production increase prices tend to increase
    5. Ethe production possibilities of an economy limit how much an economy can, in reality, grow without investment in capital goods
  6. 6Which of the following statements is NOT true (in each case assume all else being equal)?
    1. Athe larger the Marginal Propensity to Consume, the larger the multiplier effect
    2. Bthe steeper the slope of the Planned Aggregate Expenditure line, the larger the multiplier
    3. Cthe more responsive (elastic) consumers are with respect to how much they increase spending when their income increase, the larger the multiplier
    4. Dthe more people tend to buy imports the larger the multiplier
    5. Ethe actual multiplier in our economy is less than the simple spending multiplier
  7. 7In Chapter 9 we employ the Income-Expenditure Model to verify that the Aggregate Demand (AD) curve is downward sloping. How?
    1. Aby focusing on the reactions that occur when spending does not match production
    2. Binvestigating what happens to Planned Aggregate Expenditures (PAE) and Real GDP when the Price Level changes
    3. Cinvestigating what happens to the Price Level when PAE changes
    4. Dinvestigating what happens to the Price Level when Real GDP changes
    5. Einvestigating how AD shifts in response to changes in the Price Level
  8. 8Which component of Aggregate Expenditures will have the most positive impact on making growth in the economy sustainable?
    1. AConsumption
    2. BInvestment
    3. CGovernment Purchases
    4. DNet Exports
    5. Eit does not matter because changing any component of Aggregate Expenditures will make the economy grow and the multiplier effect applies equally to each and all components
  9. 9What of the following best describes the relationship between Aggregate Expenditures (AE) and Aggregate Demand (AD)?
    1. Aif AE increase, AD will increase by the same amount
    2. Bif AE increase, AD will decreases by the same amount
    3. Cif AE increases, AD will increase - most likely by more than the change in AE
    4. Dif AE increases, AD will decrease - most likely by more than the change in AE
    5. Ethere is no relationship - they are autonomous or independent
  10. 10Which component of Aggregate Expenditures is most likely to decrease if income increases?
    1. AConsumption
    2. BInvestment
    3. CGovernment Purchases
    4. DNet Exports
    5. Enone of the above - by definition when income increase all AE components increase

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Descrição
Business/Economics Quiz sobre Macro Exam 2 practice, criado por Isaiah Andrade em 30-03-2022.
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English
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