Exam 21: The Simplest Short-Run Macro Model

Suppose the price level is constant,output is demand-determined,and the economy is closed with no government.If the saving function is S = -100 + (0.2)Y,the simple multiplier is

The "marginal propensity to consume" refers to the additional

Suppose the price level is constant,output is demand-determined,and the economy is closed with no government.If the consumption function is C = (2/3)Y,then the simple multiplier is

Consider a simple macro model with a constant price level and demand-determined output.In such a model,a downward shift of the saving function causes equilibrium national income to

Consider the consumption function in our macro model.The key factors that influence desired consumption are assumed to be

Consider a simple macro model with a constant price level and demand-determined output.If the marginal propensity to spend is 0.9,the simple multiplier is

Consider the simplest macroeconomic model,with a closed economy and no government.If we assume that desired investment is autonomous with respect to national income,then the investment function (which graphs desired investment against actual national income)will be

Consider the following information describing a closed economy with no government.Aggregate output is demand determined and the price level is constant. TABLE 21-6 Refer to Table 21-6.The simple multiplier in this economy is

With respect to consumption,investment,government purchases and net exports,the national-income and product accounts measure

When would we expect to see undesired or unplanned inventory accumulation?

Consider a simple macro model with a constant price level and demand-determined output.Suppose desired aggregate expenditures are less than the current level of national income.The vertical distance between the AE curve and the 45-degree line represents

Suppose the price level is constant,output is demand-determined,and the economy is closed with no government.If the consumption function is C = (1/2)Y,the simple multiplier is

Consider the following information describing a closed economy with no government and where aggregate output is demand determined.All dollar figures are in billions. TABLE 21-4 Refer to Table 21-4.The equilibrium level of national income ($billions)will be

The assumed relationship between desired total expenditures and actual national income is called the

In a simple macro model,an increase in households' wealth is generally assumed to