Exam 14: Aggregate Expenditure Multiplier

Real GDP, Y (billions of 2005 dollars) Consumption expenditure, C (billions of 2005 Investment, I Government expendithare, G (billions of 2005 (billions of 2005 dollars) dollars) 100 150 150 150 200 200 150 150 300 250 150 150 400 300 150 150 500 350 150 150 600 400 150 150 700 450 150 150 800 500 150 150 900 550 150 150 -The above table gives information for the nation of North Hampton.There are no imports to or exports from North Hampton. a. Find aggregate planned expenditure for each level of real GDP. b. What is the equilibrium level of real GDP?

Disposable income (trillions of 2005 dollars) Consumption expenditure (trillions of 2005 dollars) 0.0 1.5 2.0 3.0 4.0 4.5 6.0 6.0 8.0 7.5 -The above table has data from the nation of Atlantica.Based on these data, at what point does saving equal zero.

Real GDP is $5 trillion and aggregate planned expenditure is $7 trillion.As a result, unplanned inventory change is ________ and real GDP ________.

As the economy turns the corner into a recession, the level of unplanned inventories ________ and firms ________ production.

What is the key difference between the aggregate expenditure model and the aggregate demand/aggregate supply model?

Which of the following increases the size of the expenditure multiplier?

If aggregate planned expenditures equal real GDP, then

Briefly describe how imports and taxes affect the size of the expenditure multiplier.

The aggregate expenditure model predicts a business cycle expansion occurs when

Disposable income (trillions of 2005 dollars) Consumption expenditure (trillions of 2005 dollars) 0.0 1.5 2.0 3.0 4.0 4.5 6.0 6.0 8.0 7.5 -The above table has data from the nation of Atlantica.Based on these data, the amount of autonomous consumption is

-The figure above shows a nation's consumption function.If disposable income is $4 trillion, then the MPC is ________ and saving is ________.

The ________ the marginal propensity to import, the ________ the expenditure multiplier.

Disposable income (trillions of 2005 dollars) Consumption expenditure (trillions of 2005 dollars) 0.0 1.5 2.0 3.0 4.0 4.5 6.0 6.0 8.0 7.5 -The above table has data from the nation of Media.Based on these data, when disposable income is $8.0 trillion, saving is

Based on data from the U.S.economy, the marginal propensity to consume is about

When the price level increases, aggregate planned expenditure ________ and equilibrium real GDP ________. As a result, in the AS-AD model, the aggregate demand curve has a ________ slope.

If aggregate planned expenditure is greater than real GDP,

The AD curve is the relationship between

If the economy is in the expansion phase of a business cycle and investment increases, when the multiplier effect kicks in the expansion

When the price level falls, the aggregate planned expenditure curve shifts ________, equilibrium expenditure ________ and there is a movement ________ along the aggregate demand curve.

"A country's expenditure multiplier is constant over time." Explain whether the previous statement is correct or incorrect.