Exam 27: The IS Curve

In the simple Keynesian model,equilibrium aggregate output is determined by

In the Keynesian cross diagram,an increase in autonomous consumer expenditure causes the aggregate demand function to shift ________,the equilibrium level of aggregate output to rise,and the IS curve to shift to the ________,everything else held constant.

In the Keynesian cross diagram,an increase in autonomous consumer expenditure causes the aggregate demand function to shift ________ and the equilibrium level of aggregate output to ________,everything else held constant.

The IS curve shifts to the left when

Keynes's motivation in developing the aggregate output determination model stemmed from his concern with explaining

A decrease in autonomous consumer expenditure causes the equilibrium level of aggregate output to ________ at any given interest rate and shifts the ________ curve to the ________,everything else held constant.

When the interest rate rises

If the consumption function is expressed as C = a + mpc × YD,then "mpc" represents

If American college students decide that drinking Mexican-brewed beer helps one get noticed,net exports will tend to fall,causing aggregate demand to ________ and the ________ curve to shift to the left,everything else held constant.

When interest rates rise in the United States (with the price level fixed),the value of the dollar ________,domestic goods become ________ expensive,and net exports ________.

In the simple Keynesian framework,declines in planned investment spending that produce high unemployment can be offset by raising

In the Keynesian cross diagram,an increase in autonomous consumer expenditure causes the aggregate demand function to shift up,the equilibrium level of aggregate output to ________,and the IS curve to shift to the ________,everything else held constant.

A depreciation of the U.S.dollar makes American goods cheaper relative to foreign goods,resulting in a ________ in net exports in the U.S.and a ________ shift of the IS curve in the U.S. ,everything else held constant.

Keynes was especially interested in explaining movements of ________ because he wanted to explain why the Great Depression had occurred and how government policy could be used to increase ________ in a similar economic situation.

In the Keynesian framework,as long as output is ________ the equilibrium level,unplanned inventory investment will remain ________ and firms will continue to raise production.

If aggregated demand is less than actual output,unplanned inventory ________ will cause output to ________.

An autonomous depreciation of the U.S.dollar makes American goods ________ relative to foreign goods and results in a ________ in U.S.net exports,everything else held constant.

Everything else held constant,if disposable income increases by 200 and consumption expenditure increases by 150,the mpc is

In the Keynesian cross diagram,a decline in autonomous consumer expenditure causes the aggregate demand function to shift ________ and the equilibrium level of aggregate output to ________,everything else held constant.

Everything else held constant,if aggregate output is to the ________ of the IS curve,then there is an excess ________ of goods which will cause aggregate output to rise.