Exam 14: Aggregate Demand and Aggregate Supply

In the long run, why does an increase in the overall price level not lead to an increase in the output of an economy? What does this imply about the shape of the long-run aggregate supply curve?

(Essay)

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Question 81

An increase in the overall price level in the economy leads to all of the following EXCEPT:

(Multiple Choice)

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Question 82

Which one of the following will decrease aggregate supply, thereby shifting the curve left?

(Multiple Choice)

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Question 83

If the short-run macroeconomic equilibrium occurs in the Keynesian range of the short-run aggregate supply curve, then an increase in the federal income tax will lead to:

(Multiple Choice)

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Question 84

For an economy operating on the long-run aggregate supply curve:

(Multiple Choice)

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Question 85

When all else is equal, if an increase in federal income tax leads to a decrease in equilibrium output and no change in the equilibrium price, then we can conclude that the economy must be operating on the:

(Multiple Choice)

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Question 86

If the nominal wage of workers increases by 10% and the real wage of workers remains unchanged, then the overall price level must have:

(Multiple Choice)

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Question 87

Suppose that the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve. If government spending increases, then in the short run, the _ will fall. However, in the long run, the _ wage will rise.

(Multiple Choice)

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Question 88

The greater the _ and the smaller the _, the greater the multiplier effect will be in an economy.

(Multiple Choice)

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Question 89

What is the difference between a market demand curve and the aggregate demand curve? In this context, explain why the substitution effect does not apply in the case of an aggregate demand curve.

(Essay)

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Question 90

When all else is equal, if an increase in government spending leads to an increase in equilibrium output and no change in equilibrium price, then we can conclude that the economy must be operating on the:

(Multiple Choice)

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Question 91

If the overall income in an economy increases by $2,000 and consumption spending increases by $1,600 as a result, then the marginal propensity to consume for the economy is:

(Multiple Choice)

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Question 92

If the overall price level in the economy is rising and at the same time workers are able to buy more goods and services, then the _ wage of workers must be _ the rise in the price level.

(Multiple Choice)

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Question 93

Use Figure: Macroeconomic Equilibrium. The figure shows four different macroeconomic equilibria for an economy. Which one of the following statements is FALSE about the shift in equilibrium points? Figure: Macroeconomic Equilibrium

(Multiple Choice)

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Question 94

The upward-sloping range of the short-run aggregate supply curve results from the stickiness of which of the following variables?

(Multiple Choice)

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Question 95

According to the real wealth effect, a higher _ implies a _ value of wealth and consumption spending.

(Multiple Choice)

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Question 96

China injects $100 into the United States by purchasing new software. If the spending multiplier for the U.S. is 5, then the total increase in spending will be:

(Multiple Choice)

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Question 97

If the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve, then an increase in input prices will lead to _ in output and _ in the price level.

(Multiple Choice)

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Question 98

If an economy is going through a severe recession (or depression), then the short-run aggregate supply curve will likely be:

(Multiple Choice)

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Question 99

If the short-run output is less than the potential output, then the:

(Multiple Choice)

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Question 100

Showing 81 - 100 of 105

In the long run, why does an increase in the overall price level not lead to an increase in the output of an economy? What does this imply about the shape of the long-run aggregate supply curve?

An increase in the overall price level in the economy leads to all of the following EXCEPT:

Which one of the following will decrease aggregate supply, thereby shifting the curve left?

If the short-run macroeconomic equilibrium occurs in the Keynesian range of the short-run aggregate supply curve, then an increase in the federal income tax will lead to:

For an economy operating on the long-run aggregate supply curve:

When all else is equal, if an increase in federal income tax leads to a decrease in equilibrium output and no change in the equilibrium price, then we can conclude that the economy must be operating on the:

If the nominal wage of workers increases by 10% and the real wage of workers remains unchanged, then the overall price level must have:

Suppose that the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve. If government spending increases, then in the short run, the _ will fall. However, in the long run, the _ wage will rise.

The greater the _ and the smaller the _, the greater the multiplier effect will be in an economy.

What is the difference between a market demand curve and the aggregate demand curve? In this context, explain why the substitution effect does not apply in the case of an aggregate demand curve.

When all else is equal, if an increase in government spending leads to an increase in equilibrium output and no change in equilibrium price, then we can conclude that the economy must be operating on the:

If the overall income in an economy increases by $2,000 and consumption spending increases by $1,600 as a result, then the marginal propensity to consume for the economy is:

If the overall price level in the economy is rising and at the same time workers are able to buy more goods and services, then the _ wage of workers must be _ the rise in the price level.

Use Figure: Macroeconomic Equilibrium. The figure shows four different macroeconomic equilibria for an economy. Which one of the following statements is FALSE about the shift in equilibrium points? Figure: Macroeconomic Equilibrium

The upward-sloping range of the short-run aggregate supply curve results from the stickiness of which of the following variables?

According to the real wealth effect, a higher _ implies a _ value of wealth and consumption spending.

China injects $100 into the United States by purchasing new software. If the spending multiplier for the U.S. is 5, then the total increase in spending will be:

If the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve, then an increase in input prices will lead to _ in output and _ in the price level.

If an economy is going through a severe recession (or depression), then the short-run aggregate supply curve will likely be:

If the short-run output is less than the potential output, then the:

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Demand

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Production Costs

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Exam 14: Aggregate Demand and Aggregate Supply

In the long run, why does an increase in the overall price level not lead to an increase in the output of an economy? What does this imply about the shape of the long-run aggregate supply curve?

An increase in the overall price level in the economy leads to all of the following EXCEPT:

Which one of the following will decrease aggregate supply, thereby shifting the curve left?

If the short-run macroeconomic equilibrium occurs in the Keynesian range of the short-run aggregate supply curve, then an increase in the federal income tax will lead to:

For an economy operating on the long-run aggregate supply curve:

When all else is equal, if an increase in federal income tax leads to a decrease in equilibrium output and no change in the equilibrium price, then we can conclude that the economy must be operating on the:

If the nominal wage of workers increases by 10% and the real wage of workers remains unchanged, then the overall price level must have:

Suppose that the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve. If government spending increases, then in the short run, the _____ will fall. However, in the long run, the _____ wage will rise.

The greater the _____ and the smaller the _____, the greater the multiplier effect will be in an economy.

What is the difference between a market demand curve and the aggregate demand curve? In this context, explain why the substitution effect does not apply in the case of an aggregate demand curve.

When all else is equal, if an increase in government spending leads to an increase in equilibrium output and no change in equilibrium price, then we can conclude that the economy must be operating on the:

If the overall income in an economy increases by $2,000 and consumption spending increases by $1,600 as a result, then the marginal propensity to consume for the economy is:

If the overall price level in the economy is rising and at the same time workers are able to buy more goods and services, then the _____ wage of workers must be _____ the rise in the price level.

Use Figure: Macroeconomic Equilibrium. The figure shows four different macroeconomic equilibria for an economy. Which one of the following statements is FALSE about the shift in equilibrium points? ​ Figure: Macroeconomic Equilibrium

The upward-sloping range of the short-run aggregate supply curve results from the stickiness of which of the following variables?

According to the real wealth effect, a higher _____ implies a _____ value of wealth and consumption spending.

China injects $100 into the United States by purchasing new software. If the spending multiplier for the U.S. is 5, then the total increase in spending will be:

If the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve, then an increase in input prices will lead to _____ in output and _____ in the price level.

If an economy is going through a severe recession (or depression), then the short-run aggregate supply curve will likely be:

If the short-run output is less than the potential output, then the:

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Demand

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Production Costs

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Suppose that the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve. If government spending increases, then in the short run, the _ will fall. However, in the long run, the _ wage will rise.

The greater the _ and the smaller the _, the greater the multiplier effect will be in an economy.

If the overall price level in the economy is rising and at the same time workers are able to buy more goods and services, then the _ wage of workers must be _ the rise in the price level.

Use Figure: Macroeconomic Equilibrium. The figure shows four different macroeconomic equilibria for an economy. Which one of the following statements is FALSE about the shift in equilibrium points? Figure: Macroeconomic Equilibrium

According to the real wealth effect, a higher _ implies a _ value of wealth and consumption spending.

If the short-run macroeconomic equilibrium occurs in the upward-sloping range of the short-run aggregate supply curve, then an increase in input prices will lead to _ in output and _ in the price level.