Question 1

The position of the long-run aggregate supply curve

Accepted Answer

A)  is determined by the things that determine output in the classical model. 
B)  is at the point where the unemployment rate is zero. 
C)  shifts to the right when the price level increases. 
D)  is at the point where the economy would cease to grow. 
A)  is determined by the things that determine output in the classical model. 
B)  is at the point where the unemployment rate is zero. 
C)  shifts to the right when the price level increases. 
D)  is at the point where the economy would cease to grow.

Question 2

Policymakers who control monetary and fiscal policy and want to offset the effects on output of an economic contraction caused by a shift in aggregate supply could use policy to shift

Accepted Answer

A)  aggregate supply to the right. 
B)  aggregate supply to the left. 
C)  aggregate demand to the right. 
D)  aggregate demand to the left. 
A)  aggregate supply to the right. 
B)  aggregate supply to the left. 
C)  aggregate demand to the right. 
D)  aggregate demand to the left.

Question 3

Other things the same,if the price level rises,then domestic interest rates

Accepted Answer

A)  rise,so domestic residents will want to hold more foreign bonds. 
B)  rise,so domestic residents will want to hold fewer foreign bonds. 
C)  fall,so domestic residents will want to hold more foreign bonds. 
D)  fall,so domestic residents will want to hold fewer foreign bonds. 
A)  rise,so domestic residents will want to hold more foreign bonds. 
B)  rise,so domestic residents will want to hold fewer foreign bonds. 
C)  fall,so domestic residents will want to hold more foreign bonds. 
D)  fall,so domestic residents will want to hold fewer foreign bonds.

Question 4

Most economists believe that classical theory describes the world in the short run but not in the long run.

Accepted Answer

A) True 
 B)False

Question 5

The classical dichotomy and monetary neutrality are represented graphically by

Accepted Answer

A)  an upward-sloping long-run aggregate-supply curve. 
B)  a vertical long-run aggregate-supply curve. 
C)  an upward-sloping short-run aggregate-curve. 
D)  a downward-sloping aggregate-demand curve. 
A)  an upward-sloping long-run aggregate-supply curve. 
B)  a vertical long-run aggregate-supply curve. 
C)  an upward-sloping short-run aggregate-curve. 
D)  a downward-sloping aggregate-demand curve.

Question 6

If speculators bid up the value of the U.S.dollar in the market for foreign exchange,then

Accepted Answer

A)  U.S.goods become more expensive relative to foreign goods so aggregate demand shifts right. 
B)  U.S.goods become less expensive relative to foreign goods so aggregate demand shifts right. 
C)  U.S.goods become more expensive relative to foreign goods so aggregate demand shifts left. 
D)  U.S.goods become less expensive relative to foreign goods so aggregate demand shifts left. 
A)  U.S.goods become more expensive relative to foreign goods so aggregate demand shifts right. 
B)  U.S.goods become less expensive relative to foreign goods so aggregate demand shifts right. 
C)  U.S.goods become more expensive relative to foreign goods so aggregate demand shifts left. 
D)  U.S.goods become less expensive relative to foreign goods so aggregate demand shifts left.

Exam 33: Aggregate Demand and Aggregate Supply

The position of the long-run aggregate supply curve

Policymakers who control monetary and fiscal policy and want to offset the effects on output of an economic contraction caused by a shift in aggregate supply could use policy to shift

Other things the same,if the price level rises,then domestic interest rates

Most economists believe that classical theory describes the world in the short run but not in the long run.

The classical dichotomy and monetary neutrality are represented graphically by

If speculators bid up the value of the U.S.dollar in the market for foreign exchange,then

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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