Exam 12: Part B: Aggregate Demand and Aggregate Supply

The following table shows the aggregate demand and aggregate supply schedule for a hypothetical economy. Refer to the above table.If the quantity of real domestic output demanded decreased by $500 and the quantity of real domestic output supplied increased by $500 at each price level, the new equilibrium price level and quantity of real domestic output would be:

Other things equal, a reduction in personal and business taxes can be expected to:

Efficiency wages will:

An economy is employing 2 units of capital, 5 units of raw materials, and 8 units of labour to produce its total output of 640 units.Each unit of capital costs $10, each unit of raw materials, $4, and each unit of labour, $3.Refer to the above information.As a result of the change indicated in the previous question, the aggregate:

Which one of the following would increase per unit production cost and therefore shift the aggregate supply curve to the left?

The Great Moderation refers to:

If the price level increases in Canada relative to foreign countries, then Canadian consumers will purchase more foreign goods and fewer Canadian goods.This statement describes:

Refer to the diagram given below. When the real output decreases from Q₁ and the price level increases from P₁, there should have been a:

Refer to the list below.Which two factors would most likely cause a change in investment spending? The following list of items is related to aggregate demand.Entrepreneurial ability Consumer expectations Degree of excess capacity Personal income tax rates Productivity National income abroad Business taxes Domestic resource availability Prices of imported products Profit expectations on investments

Refer to the figure below. In the above figure, AD₁ and AS₁ represent the original aggregate demand and aggregate supply curves, respectively.AD₂ and AS₂ show the new aggregate demand and supply curves.The changes in aggregate demand and aggregate supply result in a(n):

Which effect best explains the downward slope of the aggregate demand curve?

Which of the following explains why the aggregate demand schedule is downward sloping?

Shifts in the aggregate supply curve are caused by changes in:

An increase in consumer wealth will decrease aggregate demand.

If the dollar price of foreign currencies falls (that is, the dollar appreciates), we would expect:

A movement downward along an existing aggregate demand curve is equivalent to a(n):

The following aggregate demand and supply schedules are for a hypothetical economy: Refer to the above data.If the amount of real output demanded at each price level falls by $200, the equilibrium price level and equilibrium level of real domestic output will fall to:

Which one of the following would not shift the aggregate demand curve?

A factor that shifts the aggregate demand curve for an economy is:

Other things equal, an improvement in productivity will: