Exam 24: Aggregate Demand and the Powerful Consumer

Figure 8-2 In Figure 8-2, which of the following moves can be explained by a tax cut?

Aggregate demand is the total demand for the final goods and services produced in an economy.

If consumers receive an increase in income of $1,000, their spending will increase by a smaller amount.

Figure 8-2 In Figure 8-2, which of the following moves can be explained by a decrease in the price level?

A change in the value of consumer's stock market holdings will cause a shift in the consumption function.

The main reason that the 1975, 2008, and 2009 tax cuts did not have a large effect on GDP is that they were

The government component (G) of total output includes goods and services purchased by

If inflation rises more quickly in the United States than in France, U.S. exports to France should rise.

Among the following, which would not be considered part of the investment component of GDP?

Figure 8-2 In Figure 8-2, which of the following moves can be explained by an increase in government transfer payments?

Which of the following is not a factor that influences investment spending?

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

The value of intermediate goods is not included in the calculation of GDP to avoid the problem of

U.S. imports rise when income in the United States increases.

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

Plant, equipment, software, new housing, and inventories are part of

Figure 8-1   Based on the scatter diagram in Figure 8-1, approximately how much will consumption increase after a permanent tax cut of $400 billion?

If households decrease the amount of bank account withdrawals, the consumption function may shift upward.

Imports are a leakage in the sense that

The slope of the fitted line that shows the relationship between consumer spending and disposable income is the