Exam 15: Aggregate Demand and Aggregate Supply Analysis

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

Forecasts made by White House economists and economists at the Congressional Budget Office in 2011 projected that real GDP

Figure 15-1 -Refer to Figure 15-1.Ceteris paribus,a decrease in government spending would be represented by a movement from

The new Keynesians emphasize the importance of

Figure 15-1 -Refer to Figure 15-1.Ceteris paribus,a decrease in personal income taxes would be represented by a movement from

Which of the following would cause the short-run aggregate supply curve to shift to the right?

The international trade effect states that a(n)________ in the price level will ________ net exports.

The process of an economy adjusting from a recession back to potential GDP in the long run without any government intervention is known as

Figure 15-3 -Refer to Figure 15-3.Suppose the economy is at point A.If investment spending increases in the economy,where will the eventual long-run equilibrium be?

Suppose a developing country experiences a reduction in machinery and capital equipment as foreign entrepreneurs decrease the amount of investment in the economy.As a result

After an unexpected ________ in the price of oil,the long-run adjustment decreases the price level and ________ the unemployment rate as they return to their original levels.

Figure 15-4 -Refer to Figure 15-4.In the figure above,AD₁,LRAS₁ and SRAS₁ denote AD,LRAS and SRAS in year 1,while AD₂,LRAS₂ and SRAS₂ denote AD,LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the actual growth rate in GDP in year 2?

Figure 15-2 -Refer to Figure 15-2.Ceteris paribus,a decrease in the labor force would be represented by a movement from

Figure 15-2 -Refer to Figure 15-2.Ceteris paribus,a decrease in the expected price of an important natural resource would be represented by a movement from

Article Summary According to the International Energy Agency (IEA), increased oil production resulting from U.S. shale oil has invigorated the North American oil industry and has created a global supply shock. The shale oil and gas industry has generated tens of billions of dollars in revenues and hundreds of thousands of new jobs, and could result in the United States changing from being the world's largest oil importer to a net exporter within a few years. An IEA forecast predicts that because of shale oil, the United States will become the world's largest oil producer by 2017, with supply growing by 3.9 million barrels per day from 2012-2018. -Refer to the Article Summary.The supply shock mentioned in the article summary may well result in a decrease in the price of oil.After an unexpected decrease in the price of oil,the long-run adjustment ________ the price level and ________ the unemployment rate as they return to their original levels.

When potential GDP increases,long-run aggregate supply also increases.

If stricter immigration laws are imposed and many foreign workers in the United States are forced to go back to their home countries

Which of the following is not an assumption made by the dynamic model of aggregate demand and aggregate supply?

Workers expect inflation to fall from 4% to 1% next year.As a result,this should

The invention of the cotton gin ushered in the Industrial Revolution and began a long period of technological innovation.What did this technological change do the short-run supply curve?