Exam 17: A Brief History of Macroeconomic Thought and Policy

A policy implication of Keynesian economics is that

Figure 17-3 -Refer to Figure 17-3. Suppose the economy is at point c. A classical economist would advocate

David Ricardo focused on the economy in the _______ and on the forces that determined an JEconomy's _______.

Figure 17-1 -Refer to Figure 17-1. During the Great Depression, aggregate demand declined sharply. Suppose the economy moved to a short-run equilibrium at point k. Over time, the economy moved to point j. What could have caused the economy to move to point j?

Figure 17-1 -Refer to Figure 17-1. Which price level and output level best illustrates where the U.S. economy was before the Great Depression began?

In the new classical view,

One distinguishing feature of new Keynesian economics (from earlier schools of thought) Jis the greater use of microeconomic analysis in macroeconomic analysis.

Prior to the Great Depression, the dominant economic view held that

The classical school focused on the long-run forces that determined an economy's Jpotential level of output.

Figure 17-1 -Keynesian theory was a response to the prevailing

A fundamental feature of early classical macroeconomics is that

Which of the following statements is true about classical economists?

If prices and wages are sticky, a decrease in aggregate demand will cause

The recession in real GDP in 1970 during the Nixon administration

Keynes shifted the emphasis in economics from the concept of aggregate supply to the Jconcept of aggregate demand.

Figure 17-1 -Refer to Figure 17-1. Which point best illustrates where the U.S. economy was just prior to the Great Depression?

Which of the following statements is true about the Great Depression?

During the Great Depression, investment plummeted because

New classical economics

New Keynesian economics is built on I. the Keynesian approach II. the monetarist approach III. the new classical approach