Question 1

When prices are predetermined, the level of output that equals planned aggregate expenditure is called ______ output.

Accepted Answer

A) the natural rate of 
B) potential 
C) short-run equilibrium 
D) induced 
A) the natural rate of 
B) potential 
C) short-run equilibrium 
D) induced

Question 2

The decision about whether to change prices frequently or infrequently is an application of the:

Accepted Answer

A) principle of comparative advantage. 
B) scarcity principle. 
C) principle of increasing opportunity cost. 
D) cost-benefit principle. 
A) principle of comparative advantage. 
B) scarcity principle. 
C) principle of increasing opportunity cost. 
D) cost-benefit principle.

Question 3

The two parts of planned aggregate expenditure are ______ expenditures and ______ expenditures.

Accepted Answer

A) real; nominal 
B) inflated; deflated 
C) autonomous; induced 
D) positive; normative 
A) real; nominal 
B) inflated; deflated 
C) autonomous; induced 
D) positive; normative

Question 4

The consumption function is relationship between consumption and:

Accepted Answer

A) planned aggregate expenditure. 
B) total spending. 
C) investment. 
D) disposable income. 
A) planned aggregate expenditure. 
B) total spending. 
C) investment. 
D) disposable income.

Question 5

When real output increases, planned aggregate expenditures increase because:

Accepted Answer

A) autonomous expenditures increase. 
B) autonomous expenditures decrease. 
C) induced expenditures increase. 
D) induced expenditures decrease. 
A) autonomous expenditures increase. 
B) autonomous expenditures decrease. 
C) induced expenditures increase. 
D) induced expenditures decrease.

When prices are predetermined, the level of output that equals planned aggregate expenditure is called ______ output.

The decision about whether to change prices frequently or infrequently is an application of the:

The two parts of planned aggregate expenditure are expenditures and expenditures.

The consumption function is relationship between consumption and:

When real output increases, planned aggregate expenditures increase because:

Thinking Like an Economist

Comparative Advantage

Spending, Income, and GDP

Inflation and the Price Level

Wages and Unemployment

Economic Growth

Saving, Capital Formation, and Financial Markets

Money, Prices, and the Financial System

Short-Term Economic Fluctuations

Monetary Policy and the Federal Reserve

Aggregate Demand, Aggregate Supply, and Business Cycles

Macroeconomic Policy

Exchange Rates, International Trade, and Capital Flows

Filters

Exam 11: Spending, Output, and Fiscal Policy

When prices are predetermined, the level of output that equals planned aggregate expenditure is called ______ output.

The decision about whether to change prices frequently or infrequently is an application of the:

The two parts of planned aggregate expenditure are ______ expenditures and ______ expenditures.

The consumption function is relationship between consumption and:

When real output increases, planned aggregate expenditures increase because:

Thinking Like an Economist

Comparative Advantage

Spending, Income, and GDP

Inflation and the Price Level

Wages and Unemployment

Economic Growth

Saving, Capital Formation, and Financial Markets

Money, Prices, and the Financial System

Short-Term Economic Fluctuations

Monetary Policy and the Federal Reserve

Aggregate Demand, Aggregate Supply, and Business Cycles

Macroeconomic Policy

Exchange Rates, International Trade, and Capital Flows

Filters

The two parts of planned aggregate expenditure are expenditures and expenditures.