Exam 14: The Aggregate Model of the Macro Economy

The portion of the short-run aggregate supply that reflects the economy's resources are not fully employed is the:

A vertical curve that defines the level of full-employment or potential output based on a given amount of resources, efficiency, and technology in the economy is called:

Leading, coincident, and lagging indicators are based on the concept that:

An increase in resources available would decrease potential GDP and the long-run aggregate supply curve.

A decrease in government expenditure would shift the:

The curve that shows alternative combinations of the price level and real income that result in equilibrium in both the real goods and the money markets is called the:

A curve that shows the price level at which firms in the economy are willing to produce different levels of goods and services and the resulting level of real income is called:

What are the reasons for a decrease in the NAIRU.

A depreciation of the U.S.dollar would shift the:

Using the aggregate demand-aggregate supply diagram, graphically illustrate and explain the impact of an appreciation of the U.S.dollar on the price level and real income in the short.

At a given price level, an increase in stock market wealth will shift the aggregate demand curve:

During the recession of 2007-2009, the U.S.economy was experiencing a decrease in home prices and consumer wealth, a credit crisis in the financial markets, and declining consumer and business confidence.What components of aggregate demand were affected and what was the impact on real output? What were the policy options?

Average weekly hours in manufacturing is an example of a:

Why did the Fed shift its policy target towards the federal funds rate.

The aggregate production function shows the quantity and quality of resources used in production given the efficiency with which resources are utilized and the prevailing technology.

The decrease in consumption and investment interest-related spending that occurs when the interest rate rises as government spending increases is called:

Increases in autonomous spending cause leftward shifts of the aggregate demand and supply curves.

A decrease in the currency exchange rate would shift the aggregate demand curve rightward, resulting in a higher equilibrium income and price level in the long-run.