Exam 34: The Influence of Monetary and Fiscal Policy on Aggregate Demand

Explore all topics

Figure 34-4 -Refer to Figure 34-4. Which of the following events could explain an increase in the equilibrium interest rate from r₁ to r₃?

(Multiple Choice)

5.0/5

(34)

Question 61

Changes in the interest rate

(Multiple Choice)

4.8/5

(44)

Question 62

When there is an excess supply of money,

(Multiple Choice)

4.7/5

(37)

Question 63

With respect to their impact on aggregate demand for the U.S. economy, which of the following represents the correct ordering of the wealth effect, interest-rate effect, and exchange-rate effect from most important to least important?

(Multiple Choice)

4.9/5

(27)

Question 64

Figure 34-5 -Refer to Figure 34-5. An increase in government purchases will

(Multiple Choice)

4.8/5

(39)

Question 65

Sometimes, changes in monetary policy and/or fiscal policy are intended to offset changes to aggregate demand over which policymakers have little or no control.

(True/False)

4.8/5

(40)

Question 66

Figure 34-1 -Refer to Figure 34-1. If the current interest rate is 2 percent,

(Multiple Choice)

4.8/5

(44)

Question 67

Both monetary policy and fiscal policy affect aggregate demand.

(True/False)

4.8/5

(37)

Question 68

The Federal Reserve sets ___ policy, while the president and Congress set _ policy. These two policies influence aggregate ___.

(Short Answer)

4.9/5

(33)

Question 69

The interest-rate effect is partially explained by the fact that a higher price level reduces money demand.

(True/False)

4.9/5

(44)

Question 70

The wealth-effect notes that a _ price level increases the real value of households' wealth. The larger real wealth _ the quantity of goods and services demanded.

(Short Answer)

4.8/5

(37)

Question 71

To increase output, policymakers can ___ the money supply, _ taxes, and/or ___ government purchases.

(Short Answer)

4.9/5

(38)

Question 72

Other things the same, automatic stabilizers tend to

(Multiple Choice)

4.8/5

(39)

Question 73

Opponents of active stabilization policy

(Multiple Choice)

4.7/5

(44)

Question 74

Monetary policy affects the economy with a long lag, in part because

(Multiple Choice)

4.8/5

(27)

Question 75

The main criticism of those who doubt the ability of the government to respond in a useful way to the business cycle is that the theory by which money and government expenditures change output is flawed.

(True/False)

4.8/5

(43)

Question 76

The theory of liquidity preference is largely at odds with the basic ideas of supply and demand.

(True/False)

4.8/5

(39)

Question 77

Unemployment insurance benefits are an example of _____.

(Short Answer)

4.9/5

(30)

Question 78

The potential positive feedback that government spending may have on investment is known as the _. The potential negative effect that government spending may have on investment is known as the _ effect.

(Short Answer)

4.8/5

(30)

Question 79

Some economists, called supply-siders, argue that changes in the money supply exert a strong influence on aggregate supply.

(True/False)

5.0/5

(41)

Question 80

Showing 61 - 80 of 207

Exam 34: The Influence of Monetary and Fiscal Policy on Aggregate Demand

Figure 34-4 ​ ​ -Refer to Figure 34-4. Which of the following events could explain an increase in the equilibrium interest rate from r1 to r3?

Changes in the interest rate

When there is an excess supply of money,

With respect to their impact on aggregate demand for the U.S. economy, which of the following represents the correct ordering of the wealth effect, interest-rate effect, and exchange-rate effect from most important to least important?

Figure 34-5 ​ ​ ​ -Refer to Figure 34-5. An increase in government purchases will

Sometimes, changes in monetary policy and/or fiscal policy are intended to offset changes to aggregate demand over which policymakers have little or no control.

Figure 34-1 ​ -Refer to Figure 34-1. If the current interest rate is 2 percent,

Both monetary policy and fiscal policy affect aggregate demand.

The Federal Reserve sets _____ policy, while the president and Congress set _____ policy. These two policies influence aggregate _____.

The interest-rate effect is partially explained by the fact that a higher price level reduces money demand.

The wealth-effect notes that a _____ price level increases the real value of households' wealth. The larger real wealth _____ the quantity of goods and services demanded.

To increase output, policymakers can _____ the money supply, _____ taxes, and/or _____ government purchases.

Other things the same, automatic stabilizers tend to

Opponents of active stabilization policy

Monetary policy affects the economy with a long lag, in part because

The main criticism of those who doubt the ability of the government to respond in a useful way to the business cycle is that the theory by which money and government expenditures change output is flawed.

The theory of liquidity preference is largely at odds with the basic ideas of supply and demand.

Unemployment insurance benefits are an example of _____.

The potential positive feedback that government spending may have on investment is known as the _____. The potential negative effect that government spending may have on investment is known as the _____ effect.

Some economists, called supply-siders, argue that changes in the money supply exert a strong influence on aggregate supply.

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

Applications: 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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

Figure 34-4 -Refer to Figure 34-4. Which of the following events could explain an increase in the equilibrium interest rate from r₁ to r₃?

Figure 34-5 -Refer to Figure 34-5. An increase in government purchases will

Figure 34-1 -Refer to Figure 34-1. If the current interest rate is 2 percent,

The Federal Reserve sets ___ policy, while the president and Congress set _ policy. These two policies influence aggregate ___.

The wealth-effect notes that a _ price level increases the real value of households' wealth. The larger real wealth _ the quantity of goods and services demanded.

To increase output, policymakers can ___ the money supply, _ taxes, and/or ___ government purchases.

The potential positive feedback that government spending may have on investment is known as the _. The potential negative effect that government spending may have on investment is known as the _ effect.