Question 1

Other things the same,which of the following is correct?

Accepted Answer

A)  A decrease in the price level causes the dollar to appreciate.Aggregate demand shifts right. 
B)  A decrease in the price level causes the dollar to depreciate.Aggregate demand shifts right. 
C)  If speculators lose confidence in the American economy,the dollar appreciates.Aggregate demand shifts right. 
D)  If speculators lose confidence in the American economy,the dollar depreciates.Aggregate demand shifts right. 
A)  A decrease in the price level causes the dollar to appreciate.Aggregate demand shifts right. 
B)  A decrease in the price level causes the dollar to depreciate.Aggregate demand shifts right. 
C)  If speculators lose confidence in the American economy,the dollar appreciates.Aggregate demand shifts right. 
D)  If speculators lose confidence in the American economy,the dollar depreciates.Aggregate demand shifts right.

Question 2

As the price level rises,the interest rate

Accepted Answer

A)  falls,so the supply of dollars in the market for foreign currency exchange shifts left. 
B)  falls,so the supply of dollars in the market for foreign currency exchange shifts right. 
C)  rises,so the supply of dollars in the market for foreign currency exchange shifts left. 
D)  rises,so the supply of dollars in the market for foreign currency exchange shifts right. 
A)  falls,so the supply of dollars in the market for foreign currency exchange shifts left. 
B)  falls,so the supply of dollars in the market for foreign currency exchange shifts right. 
C)  rises,so the supply of dollars in the market for foreign currency exchange shifts left. 
D)  rises,so the supply of dollars in the market for foreign currency exchange shifts right.

Question 3

Most economists believe that in the long run,changes in the money supply

Accepted Answer

A)  affect nominal but not real variables.This view that money is ultimately neutral is consistent with classical theory. 
B)  affect nominal but not real variables.This view that money is ultimately neutral is inconsistent with classical theory. 
C)  affect real but not nominal variables.This view that money is ultimately neutral is consistent with classical theory. 
D)  affect real but not nominal variables.This view that money is ultimately neutral is inconsistent with classical theory. 
A)  affect nominal but not real variables.This view that money is ultimately neutral is consistent with classical theory. 
B)  affect nominal but not real variables.This view that money is ultimately neutral is inconsistent with classical theory. 
C)  affect real but not nominal variables.This view that money is ultimately neutral is consistent with classical theory. 
D)  affect real but not nominal variables.This view that money is ultimately neutral is inconsistent with classical theory.

Question 4

Other things the same,what happens to the price level and quantity of output when an adverse shift in the short run aggregate supply curve occurs?

Accepted Answer

Price leve

Question 5

Which of the following is correct?

Accepted Answer

A)  Real GDP is the variable most commonly used to measure short-run economic fluctuations.These fluctuations can be predicted with some accuracy. 
B)  Real GDP is the variable most commonly used to measure short-run economic fluctuations.It is almost impossible to predict these fluctuations with much accuracy. 
C)  Nominal GDP is the variable most commonly used to measure short-run economic fluctuations.These fluctuations can be predicted with some accuracy. 
D)  Nominal GDP is the variable most commonly used to measure short-run economic fluctuations.It is almost impossible to predict these fluctuations with much accuracy. 
A)  Real GDP is the variable most commonly used to measure short-run economic fluctuations.These fluctuations can be predicted with some accuracy. 
B)  Real GDP is the variable most commonly used to measure short-run economic fluctuations.It is almost impossible to predict these fluctuations with much accuracy. 
C)  Nominal GDP is the variable most commonly used to measure short-run economic fluctuations.These fluctuations can be predicted with some accuracy. 
D)  Nominal GDP is the variable most commonly used to measure short-run economic fluctuations.It is almost impossible to predict these fluctuations with much accuracy.

Question 6

According to the misperceptions theory of the short-run aggregate supply curve,if a firm thought that inflation was going to be 4 percent and actual inflation was 2 percent,then the firm would believe that the relative price of what it produces had

Accepted Answer

A)  increased,so it would increase production. 
B)  increased,so it would decrease production. 
C)  decreased,so it would increase production. 
D)  decreased,so it would decrease production. 
A)  increased,so it would increase production. 
B)  increased,so it would decrease production. 
C)  decreased,so it would increase production. 
D)  decreased,so it would decrease production.

Question 7

If speculators bid up the value of the dollar in the market for foreign-currency exchange,U.S.aggregate demand would shift to the left.

Accepted Answer

A) True 
 B)False

Question 8

When the price level falls

Accepted Answer

A)  the interest rate rises,so the quantity of goods and services demand rises. 
B)  the interest rate rises,so the quantity of goods and services demand falls. 
C)  the interest rate falls,so the quantity of goods and services demand rises. 
D)  the interest rate falls,so the quantity of goods and services demand falls. 
A)  the interest rate rises,so the quantity of goods and services demand rises. 
B)  the interest rate rises,so the quantity of goods and services demand falls. 
C)  the interest rate falls,so the quantity of goods and services demand rises. 
D)  the interest rate falls,so the quantity of goods and services demand falls.

Question 9

As the price level falls

Accepted Answer

A)  people are more willing to lend,so interest rates rise. 
B)  people are more willing to lend,so interest rates fall. 
C)  people are less willing to lend,so interest rates fall. 
D)  people are less willing to lend,so interest rates rise. 
A)  people are more willing to lend,so interest rates rise. 
B)  people are more willing to lend,so interest rates fall. 
C)  people are less willing to lend,so interest rates fall. 
D)  people are less willing to lend,so interest rates rise.

Question 10

Make a list of things that would shift the long-run aggregate supply curve to the right.

Accepted Answer

Examples in the text (or variations)incl

Question 11

Which of the following shifts aggregate demand to the left?

Accepted Answer

A)  The price level rises. 
B)  The price level falls. 
C)  The dollar depreciates for some reason other than a change in the price level. 
D)  Stock prices fall for some reason other than a change in the price level. 
A)  The price level rises. 
B)  The price level falls. 
C)  The dollar depreciates for some reason other than a change in the price level. 
D)  Stock prices fall for some reason other than a change in the price level.

Exam 33: Aggregate Demand and Aggregate Supply

Other things the same,which of the following is correct?

As the price level rises,the interest rate

Most economists believe that in the long run,changes in the money supply

Other things the same,what happens to the price level and quantity of output when an adverse shift in the short run aggregate supply curve occurs?

Which of the following is correct?

According to the misperceptions theory of the short-run aggregate supply curve,if a firm thought that inflation was going to be 4 percent and actual inflation was 2 percent,then the firm would believe that the relative price of what it produces had

If speculators bid up the value of the dollar in the market for foreign-currency exchange,U.S.aggregate demand would shift to the left.

When the price level falls

As the price level falls

Make a list of things that would shift the long-run aggregate supply curve to the right.

Which of the following shifts aggregate demand to the left?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply,demand,and Government Policies

Consumers,producers,and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Market for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving,investment,and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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