Exam 12: Aggregate Expenditure and Output in the Short Run

Consumption spending is $16 million,planned investment spending is $4 million,unplanned investment spending is $2 million,government purchases are $6 million,and net export spending is $1 million.What is aggregate expenditure?

The difference between GDP and net taxes is

The aggregate expenditure model focuses on the ________ relationship between real spending and ________.

The multiplier is calculated as the

Given Table 23-4 below,fill in the values of the marginal propensity to save (MPS)and the marginal propensity to consume (MPC).Show that MPC + MPS = 1. Table 23-4

Figure 23-2 -Refer to Figure 23-2.If the U.S.economy is currently at point K,which of the following could cause it to move to point N?

Consumption spending is $5 million,planned investment spending is $8 million,unplanned investment spending is $2 million,government purchases are $10 million,and net export spending is $2 million.What is GDP?

Consumption spending is $22 million,planned investment spending is $7 million,actual investment spending is $7 million,government purchases are $9 million,and net export spending is $3 million.Based on this information,which of the following is true?

Firms in a small economy planned that inventories would grow over the past year by $500,000.Over that year,inventories did grow by exactly $500,000.This implies that

An increase in the price level in the United States will shift the aggregate expenditure line upward.

The marginal propensity to save is defined as

An increase in the price level results in a(n)________ in household consumption spending and a(n)________ in investment spending.

If the consumption function is defined as C = 5,500 + 0.9Y,what is the value of the multiplier?

What impact does a lower price level have on interest rates,wealth,and investment spending?

If the multiplier is 5,the marginal propensity to consume must be 0.8.

Planned aggregate expenditure is equal to

Given Table 23-3 below,fill in the values for saving.Assume taxes = $800. Table 23-3

If inflation in the United States is higher than inflation in other countries,what will be the effect on net exports for the United States?

The ratio of the increase in ________ to the increase in ________ is called the multiplier.

If aggregate expenditure is less than GDP,how will the economy reach macroeconomic equilibrium?