(Exhibit: Saving, Investment, and the Interest Rate 1) Reference: Ref 3-1 (Exhibit: Saving, Investment, and the Interest Rate 1) The economy begins in equilibrium at Point E1, representing the real interest rate, r1 , at which saving, S , equals desired Investment, I1 . What will be the new equilibrium combination of real interest rate, saving, and Investment if the government cuts spending, holding other factors constant?

A) Point A B) Point B C) Point C D) Point D A) Point A B) Point B C) Point C D) Point D

A) income minus consumption minus government spending. B) disposable income minus consumption. C) disposable income minus government spending. D) taxes minus government spending. A) income minus consumption minus government spending. B) disposable income minus consumption. C) disposable income minus government spending. D) taxes minus government spending.

Exam 3: National Income: Where It Comes From and Where It Goes

In an economy with flexible prices, competitive factor markets and fixed supplies of the factors of production, graphically illustrate the impact of a deadly virus that kills a large part of the labor force, but leaves the other factors of production untouched, ceteris paribus. Be sure to label: i. the axes; ii. the curves; iii. the initial equilibrium values; iv. the direction the curves shift; and the terminal equilibrium values. Explain in words how the equilibrium values change.

(Essay)

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Question 41

In examining the impact of fiscal policy, it is assumed that:

(Multiple Choice)

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Question 42

If the consumption function is given by the equation C = 500 + 0.5Y, the production function is Y = 50K0.5L0.5, where K = 100 and L = 100, then C equals:

(Multiple Choice)

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Question 43

(Exhibit: Saving, Investment, and the Interest Rate 1) Reference: Ref 3-1 (Exhibit: Saving, Investment, and the Interest Rate 1) The economy begins in equilibrium at Point E₁, representing the real interest rate, r₁ , at which saving, S , equals desired Investment, I₁ . What will be the new equilibrium combination of real interest rate, saving, and Investment if the government cuts spending, holding other factors constant?

(Multiple Choice)

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Question 44

The real wage will increase if:

(Multiple Choice)

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Question 45

If saving exceeds investment demand and consumption is not a function of the interest rate:

(Multiple Choice)

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Question 46

Assume that equilibrium GDP (Y) is 5,000. Consumption is given by the equation C = 500 + 0.6Y. Investment (I) is given by the equation I = 2,000 - 100r, where r is the real interest rate in percent. No government exists. In this case, the equilibrium real interest rate is:

(Multiple Choice)

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Question 47

When there is a fixed supply of loanable funds, an increase in investment demand results in a(n):

(Multiple Choice)

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Question 48

The nominal interest rate is the:

(Multiple Choice)

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Question 49

Assume that the production function is Cobb-Douglas with parameter $\alpha$ = 0.3. If factors are paid their marginal products, capital and labor, respectively, receive the shares of income:

(Multiple Choice)

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Question 50

In the long run, what determines the level of total production of goods and services in an economy?

(Multiple Choice)

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Question 51

Assume that an increase in consumer confidence raises consumers' expectations of future income and thus the amount they want to consume today for any given income. This shift, in a neoclassical economy, will:

(Multiple Choice)

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Question 52

Unlike the real world, the classical model with fixed output assumes that:

(Multiple Choice)

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Question 53

In the classical model, what adjusts to eliminate any unemployment of labor in the economy?

(Multiple Choice)

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Question 54

Assume that a firm is considering building a factory that will cost $5 million. It believes that it can get a profit from this factory of $600,000 per year for many years. The interest rate at which the firm can borrow money is 15 percent. After evaluating whether it should build the factory, the firm decides that it should:

(Multiple Choice)

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Question 55

Private saving is:

(Multiple Choice)

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Question 56

The demand for loanable funds is equivalent to:

(Multiple Choice)

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Question 57

In the classical model with fixed income, if the interest rate is too low, then investment is too and the demand for output the supply.

(Multiple Choice)

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Question 58

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, workers should experience high rates of real wage growth when:

(Multiple Choice)

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Question 59

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly:

(Multiple Choice)

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Question 60

Showing 41 - 60 of 158

In examining the impact of fiscal policy, it is assumed that:

If the consumption function is given by the equation C = 500 + 0.5Y, the production function is Y = 50K0.5L0.5, where K = 100 and L = 100, then C equals:

The real wage will increase if:

If saving exceeds investment demand and consumption is not a function of the interest rate:

Assume that equilibrium GDP (Y) is 5,000. Consumption is given by the equation C = 500 + 0.6Y. Investment (I) is given by the equation I = 2,000 - 100r, where r is the real interest rate in percent. No government exists. In this case, the equilibrium real interest rate is:

When there is a fixed supply of loanable funds, an increase in investment demand results in a(n):

The nominal interest rate is the:

Assume that the production function is Cobb-Douglas with parameter $\alpha$ = 0.3. If factors are paid their marginal products, capital and labor, respectively, receive the shares of income:

In the long run, what determines the level of total production of goods and services in an economy?

Assume that an increase in consumer confidence raises consumers' expectations of future income and thus the amount they want to consume today for any given income. This shift, in a neoclassical economy, will:

Unlike the real world, the classical model with fixed output assumes that:

In the classical model, what adjusts to eliminate any unemployment of labor in the economy?

Private saving is:

The demand for loanable funds is equivalent to:

In the classical model with fixed income, if the interest rate is too low, then investment is too and the demand for output the supply.

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, workers should experience high rates of real wage growth when:

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly:

The Science of Macroeconomics

The Data of Macroeconomics

Money and Inflation

The Open Economy

Unemployment

Economic Growth I: Capital Accumulation and Population Growth

Economic Growth II: Technology, Empirics, and Policy

Introduction to Economic Fluctuations

Aggregate Demand I: Building the Is-Lm Model

Aggregate Demand II: Applying the Is-Lm Model

Aggregate Supply and the Short-Run Tradeoff Between Inflation and Unemployment

Stabilization Policy

Government Debt and Budget Deficits

Introduction to the Financial System

Asset Prices and Interest Rates

Securities Markets

Banking

Financial Crises

Filters

Exam 3: National Income: Where It Comes From and Where It Goes

In examining the impact of fiscal policy, it is assumed that:

If the consumption function is given by the equation C = 500 + 0.5Y, the production function is Y = 50K0.5L0.5, where K = 100 and L = 100, then C equals:

The real wage will increase if:

If saving exceeds investment demand and consumption is not a function of the interest rate:

Assume that equilibrium GDP (Y) is 5,000. Consumption is given by the equation C = 500 + 0.6Y. Investment (I) is given by the equation I = 2,000 - 100r, where r is the real interest rate in percent. No government exists. In this case, the equilibrium real interest rate is:

When there is a fixed supply of loanable funds, an increase in investment demand results in a(n):

The nominal interest rate is the:

Assume that the production function is Cobb-Douglas with parameter α\alphaα = 0.3. If factors are paid their marginal products, capital and labor, respectively, receive the shares of income:

In the long run, what determines the level of total production of goods and services in an economy?

Assume that an increase in consumer confidence raises consumers' expectations of future income and thus the amount they want to consume today for any given income. This shift, in a neoclassical economy, will:

Unlike the real world, the classical model with fixed output assumes that:

In the classical model, what adjusts to eliminate any unemployment of labor in the economy?

Private saving is:

The demand for loanable funds is equivalent to:

In the classical model with fixed income, if the interest rate is too low, then investment is too and the demand for output the supply.

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, workers should experience high rates of real wage growth when:

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly:

The Science of Macroeconomics

The Data of Macroeconomics

Money and Inflation

The Open Economy

Unemployment

Economic Growth I: Capital Accumulation and Population Growth

Economic Growth II: Technology, Empirics, and Policy

Introduction to Economic Fluctuations

Aggregate Demand I: Building the Is-Lm Model

Aggregate Demand II: Applying the Is-Lm Model

Aggregate Supply and the Short-Run Tradeoff Between Inflation and Unemployment

Stabilization Policy

Government Debt and Budget Deficits

Introduction to the Financial System

Asset Prices and Interest Rates

Securities Markets

Banking

Financial Crises

Filters

Assume that the production function is Cobb-Douglas with parameter $\alpha$ = 0.3. If factors are paid their marginal products, capital and labor, respectively, receive the shares of income: