Exam 24: Aggregate Demand and the Powerful Consumer

A movement upward along the consumption function can be caused only by a(n)

The difference between national income and disposable income is

Fixed-money assets, like stocks and bonds, are included in which of the following components of GDP?

Anna enters the workforce after being unemployed for a year.How would this be shown on her consumption function?

The accounting identity for the economy's factor payments can be written as ____.

The MPC for a country will likely be measured as less than 1.0.

In which of the following years was a tax cut ineffective in stimulating aggregate demand?

For each $1 of a tax cut, economists expect consumption to

Which of the following is the best example of an intermediate good?

Explain why it makes a difference if consumers consider a tax cut temporary rather than permanent.What does this explanation tell us about the importance of government credibility? Put this in the context of the 2008 and 2009 tax cuts favored by President Bush and President Obama.

In economic analysis, which of the following is considered an injection?

Aggregate demand is the sum of total domestic spending by the private sector.

A scatter diagram is a way to show the relationship between disposable income and consumer expenditures.

To predict the effects of a tax cut on consumption spending, economists must have some estimate of the

Which of the following is the injection into the circular flow model?

Inventories are

Consumers most likely decide on their current consumption spending by looking at their short-run income prospects.

If the price level increases, we would expect consumers to

If the Japanese economy is currently suffering from a recession, we should expect U.S.exports to Japan to

Investment spending, in economic terms, includes spending toward physical capital, machinery, new factories, and new housing.