Question 1

The business cycle ________ on FedEx since the company's inception over 40 years ago.

Accepted Answer

A) has had virtually no effect 
B) has always had a negative effect 
C) has had a large effect 
D) has always had a positive effect 
A) has had virtually no effect 
B) has always had a negative effect 
C) has had a large effect 
D) has always had a positive effect

Question 2

Explain why the long-run aggregate supply curve is vertical.

Accepted Answer

The long-run aggregate supply curve is v

Question 3

In the long run

Accepted Answer

A) GDP = potential GDP. 
B) unemployment is below its natural rate. 
C) LRAS and SRAS lie on the same line. 
D) unemployment is above its natural rate. 
A) GDP = potential GDP. 
B) unemployment is below its natural rate. 
C) LRAS and SRAS lie on the same line. 
D) unemployment is above its natural rate.

Question 4

Which of the following is not a reason why the wages of workers and the prices of inputs rise more slowly than the prices of final goods and services?

Accepted Answer

A) Contracts make prices and wages "sticky." 
B) Firms are often slow to adjust wages. 
C) Menu costs make some prices sticky. 
D) Unions are successful in pushing up wages. 
A) Contracts make prices and wages "sticky." 
B) Firms are often slow to adjust wages. 
C) Menu costs make some prices sticky. 
D) Unions are successful in pushing up wages.

Question 5

Monetarists believe that the quantity of money should be increased at an increasing rate.

Accepted Answer

A) True 
 B)False

Question 6

Explain whether FedEx's sales are likely to fluctuate more or less than the sales of each of the following firms as the economy moves from recession to expansion and back to recession.
Whirlpool Corporation (appliance manufacturer)
Taco Bell
The Boeing Company (aircraft manufacturer)
GameStop (video game sales and rentals)

Accepted Answer

FedEx's sales are likely to fluctuate du

Question 7

An increase in aggregate demand in the economy will have what effect on macroeconomic equilibrium in the long run?

Accepted Answer

A) The price level will fall, and the level of GDP will rise. 
B) The price level will fall, and the level of GDP will fall. 
C) The price level will rise, and the level of GDP will fall. 
D) The price level will rise, and the level of GDP will be unaffected. 
A) The price level will fall, and the level of GDP will rise. 
B) The price level will fall, and the level of GDP will fall. 
C) The price level will rise, and the level of GDP will fall. 
D) The price level will rise, and the level of GDP will be unaffected.

Question 8

________ of unemployment during ________ make it easier for workers to ________ wages.

Accepted Answer

A) High levels; a recession; negotiate higher 
B) Low levels; an expansion; negotiate higher 
C) Low levels; a recession; accept lower 
D) High levels; an expansion; accept lower 
A) High levels; a recession; negotiate higher 
B) Low levels; an expansion; negotiate higher 
C) Low levels; a recession; accept lower 
D) High levels; an expansion; accept lower

Question 9

According to the real business cycle model

Accepted Answer

A) increases in aggregate demand raise GDP. 
B) increases in aggregate demand lower GDP. 
C) increases in aggregate demand do not affect GDP. 
D) increases in aggregate demand lower the price level. 
A) increases in aggregate demand raise GDP. 
B) increases in aggregate demand lower GDP. 
C) increases in aggregate demand do not affect GDP. 
D) increases in aggregate demand lower the price level.

Question 10

The basic aggregate demand and aggregate supply curve model helps explain

Accepted Answer

A) short term fluctuations in real GDP and the price level. 
B) long term growth. 
C) price fluctuations in an individual market. 
D) output fluctuations in an individual market. 
A) short term fluctuations in real GDP and the price level. 
B) long term growth. 
C) price fluctuations in an individual market. 
D) output fluctuations in an individual market.

Question 11

When the price level in the United States rises relative to the price level of other countries,________ will rise,________ will fall,and ________ will fall.

Accepted Answer

A) imports; exports; net exports 
B) exports; imports; net exports 
C) net exports; exports; imports 
D) net exports; imports; exports 
A) imports; exports; net exports 
B) exports; imports; net exports 
C) net exports; exports; imports 
D) net exports; imports; exports

Question 12

The level of long-run aggregate supply is affected by all of the following except

Accepted Answer

A) changes in the price level. 
B) changes in the technology. 
C) changes in the capital stock. 
D) changes in the number of workers. 
A) changes in the price level. 
B) changes in the technology. 
C) changes in the capital stock. 
D) changes in the number of workers.

Question 13

New Keynesian macroeconomic theory emphasizes the role of "sticky" prices in the economy.

Accepted Answer

A) True 
 B)False

Question 14

The level of aggregate supply in the long-run is not affected by

Accepted Answer

A) changes in technology. 
B) changes in the capital stock. 
C) changes in the price level. 
D) changes in the number of workers. 
A) changes in technology. 
B) changes in the capital stock. 
C) changes in the price level. 
D) changes in the number of workers.

Question 15

The level of real GDP in the long run is called

Accepted Answer

A) potential GDP. 
B) short-run GDP. 
C) frictional GDP. 
D) low-capacity GDP. 
A) potential GDP. 
B) short-run GDP. 
C) frictional GDP. 
D) low-capacity GDP.

Question 16

Inflation is generally the result of total spending growing faster than total production.

Accepted Answer

A) True 
 B)False

Question 17

Suppose the U.S.GDP growth rate is faster relative to other countries' GDP growth rates.This will

Accepted Answer

A) move the economy up along a stationary aggregate demand curve. 
B) move the economy down along a stationary aggregate demand curve. 
C) shift the aggregate demand curve to the left. 
D) shift the aggregate demand curve to the right. 
A) move the economy up along a stationary aggregate demand curve. 
B) move the economy down along a stationary aggregate demand curve. 
C) shift the aggregate demand curve to the left. 
D) shift the aggregate demand curve to the right.

Question 18

Figure 15-2
  
-Refer to Figure 15-2.Ceteris paribus,a decrease in the expected future price level would be represented by a movement from

Accepted Answer

A) SRAS₁ to SRAS₂. 
B) SRAS₂ to SRAS₁. 
C) point A to point B. 
D) point B to point A. 
A) SRAS₁ to SRAS₂. 
B) SRAS₂ to SRAS₁. 
C) point A to point B. 
D) point B to point A.

Question 19

Inflation will

Accepted Answer

A) increase aggregate demand. 
B) increase the quantity of real GDP demanded. 
C) decrease aggregate demand. 
D) decrease the quantity of real GDP demanded. 
A) increase aggregate demand. 
B) increase the quantity of real GDP demanded. 
C) decrease aggregate demand. 
D) decrease the quantity of real GDP demanded.

Question 20

The basic aggregate demand and aggregate supply curve model helps explain ________ fluctuations in real GDP and the price level.

Accepted Answer

A) short-term 
B) long-term 
C) both short-term and long-term 
D) unrelated 
A) short-term 
B) long-term 
C) both short-term and long-term 
D) unrelated

The business cycle ________ on FedEx since the company's inception over 40 years ago.

Explain why the long-run aggregate supply curve is vertical.

In the long run

Which of the following is not a reason why the wages of workers and the prices of inputs rise more slowly than the prices of final goods and services?

Monetarists believe that the quantity of money should be increased at an increasing rate.

An increase in aggregate demand in the economy will have what effect on macroeconomic equilibrium in the long run?

of unemployment during make it easier for workers to wages.

According to the real business cycle model

The basic aggregate demand and aggregate supply curve model helps explain

When the price level in the United States rises relative to the price level of other countries, will rise, will fall,and will fall.

The level of long-run aggregate supply is affected by all of the following except

New Keynesian macroeconomic theory emphasizes the role of "sticky" prices in the economy.

The level of aggregate supply in the long-run is not affected by

The level of real GDP in the long run is called

Inflation is generally the result of total spending growing faster than total production.

Suppose the U.S.GDP growth rate is faster relative to other countries' GDP growth rates.This will

Figure 15-2 -Refer to Figure 15-2.Ceteris paribus,a decrease in the expected future price level would be represented by a movement from

Inflation will

The basic aggregate demand and aggregate supply curve model helps explain ________ fluctuations in real GDP and the price level.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 15: Aggregate Demand and Aggregate Supply Analysis

The business cycle ________ on FedEx since the company's inception over 40 years ago.

Explain why the long-run aggregate supply curve is vertical.

In the long run

Which of the following is not a reason why the wages of workers and the prices of inputs rise more slowly than the prices of final goods and services?

Monetarists believe that the quantity of money should be increased at an increasing rate.

An increase in aggregate demand in the economy will have what effect on macroeconomic equilibrium in the long run?

________ of unemployment during ________ make it easier for workers to ________ wages.

According to the real business cycle model

The basic aggregate demand and aggregate supply curve model helps explain

When the price level in the United States rises relative to the price level of other countries,________ will rise,________ will fall,and ________ will fall.

The level of long-run aggregate supply is affected by all of the following except

New Keynesian macroeconomic theory emphasizes the role of "sticky" prices in the economy.

The level of aggregate supply in the long-run is not affected by

The level of real GDP in the long run is called

Inflation is generally the result of total spending growing faster than total production.

Suppose the U.S.GDP growth rate is faster relative to other countries' GDP growth rates.This will

Figure 15-2 -Refer to Figure 15-2.Ceteris paribus,a decrease in the expected future price level would be represented by a movement from

Inflation will

The basic aggregate demand and aggregate supply curve model helps explain ________ fluctuations in real GDP and the price level.

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

of unemployment during make it easier for workers to wages.

When the price level in the United States rises relative to the price level of other countries, will rise, will fall,and will fall.