Exam 24: Aggregate Demand and the Powerful Consumer

The tax cut of 2009 had little significant effect on consumer spending because it

Figure 8-1 ​ -Based on the scatter diagram in Figure 8-1, if real disposable income is $800 billion, the consumption spending would be approximately

The largest component of aggregate demand is

A scatter diagram could help a policy maker decide on the size of a tax cut necessary to increase consumer expenditures by a certain amount.

Which of the following will most likely have the greatest effect on an individual's consumption function?

If Kobe, an NBA star athlete, earns $10 million per year but has no money in the bank, he has a

Which of the following factors would cause your consumption function to shift upward?

A movement along the consumption function can be caused by a

The federal government's principal tool in altering consumer spending is changing

Changes to the price level affect consumers' purchasing power; therefore, it will most likely impact their

The relationship between consumption and disposable income is such that as

Government spending is an injection in the sense that it

National income can be calculated by subtracting

Which of the following would be added to U.S.national income?

If an individual's income increases by $100, then their spending will increase by less than $100.

The value-added approach of measuring GDP does not do the following.

Inventories are goods that can be considered as "purchased" by

If an economist wants to make a prediction about the effects of a change in disposable income on the change in consumption spending based on historical data, she must assume that

In the national income accounts, new investment goods are considered

If real disposable income is $300 billion and real consumer expenditures are $250 billion, it can be assumed that